The Pound sterling has plummeted to its lowest level against the US dollar since 1985.
On Wednesday afternoon, September 7, the Pound fell by 0.64% to $1.145, a decline not seen in 37 years.
According to the Bank of England, a weaker outlook for the UK economy as well as a stronger dollar were putting pressure on sterling.
Bank of England Governor Andrew Bailey also warned that little could be done to stop the UK falling into a recession this year as the war in Ukraine continued and energy prices keep soaring.
The Bank says it forecasts the economy to shrink in the last three months of 2022 and keep shrinking until the end of 2023.
Speaking in front of the Treasury Select Committee on Wednesday, Mr Bailey said “sadly” a recession remained the most likely outcome in the UK.
When asked by MPs if there was much that the central bank could do to stop it, he said: “Insofar as the war is having this huge effect, the answer to that would be no.”
Governor Andrew Bailey said a recession would “overwhelmingly be caused by the actions of Russia and the impact on energy prices”.
Last month the central bank raised interest rates by the highest margin in 27 years in a bid to keep soaring prices under control.
Bailey added: “The person going to put the UK in recession is Vladimir Putin, not the MPC [Monetary Policy Committee].”