Beer, mortgage take a hit as UK pound tumbles

The UK government’s economic plans have seen the pound sink to an all-time low against the US dollar, with market confidence taking a hammering in the wake of the chancellor’s unveiling of the biggest tax cuts in over 50 years and a hint that more cuts could be on the way.
Sterling has hit its lowest level against the dollar since decimalisation in 1971, falling by more than 4 per cent to just 1.03 dollars in early Asia trading before it regained some ground to about 1.07 dollars earlier today (Monday, 26 September).
The euro also hit a fresh 20-year low against the dollar amid recession and energy-security fears ahead of what is expected to be a painful winter across Europe, with the war in Ukraine showing no sign of ending.
Experts warned that the pound’s plunge towards parity with the dollar will send the cost of goods soaring even higher, potentially worsening the cost-of-living crisis. The pound’s fall also means it will be more expensive for the government to borrow money – just when it has decided to borrow billions more.
Figures released by Rightmove on Monday showed the average price tag on a home has increased by £2,587 or 0.7 per cent month-on-month in September.
Paul Davies, chief executive officer of the Carlsberg Marston’s Brewing Company, said the pound’s slide to a record low was “worrying” for the beer sector.
Products imported into the UK, such as those used by the food and drink sector, would be more expensive and could lead to price increases being passed on to customers.
Davies told BBC Radio 4’s Today programme that the drop was “worrying” for the British beer industry as it imports a significant amount of beer and hops.
Asked if the value of the pound mattered, Davies said: “Yes it does. Many of the hops used in this country are actually imported and a lot of them, particularly for craft brewers, are imported from the States.
“Changes in currency is actually worrying for industry, and then of course people drink a lot of imported beers from Europe and the euro versus the pound is also something we’re watching very closely at the moment.”
The pound was also lower against the euro on Monday morning, having fallen by around 6 per cent against the eurozone currency over the past month.