LONDON – The British pound fell sharply against other currencies before stabilizing somewhat on Monday as investors reacted to the downgrade of the U.K.’s cherished triple-A credit rating.
During early trading, the British currency dropped to $1.5069 against the dollar — its lowest level since July 2010 — before recovering to $1.5144. Against the euro, it hovered around 18-month lows, with one euro worth 0.8745 pound.
Late Friday, after European markets had closed, Moody’s Investor Service downgraded the U.K.’s credit rating by one notch from the top AAA to AA1. It said sluggish economic growth would hinder the government’s ability to control rising debt levels and deal with any new financial shocks.
Because it was the first such downgrade for Britain, which unlike the U.S. [...]
