Sterling foreign currency, one of the world’s major currencies, hit a record low against the dollar in January, with the benchmark index falling by 0.3% against the greenback.
The benchmark rate against the U.S. dollar was hovering around US20.7% before falling to US20% on Thursday, the lowest since February 2014.
The rate is now at US19.8%, according to Bloomberg data.
The currency had already been sliding against the euro for weeks, as investors worried about the country’s economy, its debt and political stability.
The U.K. had a Brexit-style vote in June to leave the European Union.
Sterling’s slide has left the currency struggling to gain any traction as it has struggled to break through the Eurozone’s two-year-low of 1.3%.
“Sterling’s weakness in January was caused by strong capital flows from the U, U.A.E., China, India, Africa, and emerging markets, the International Monetary Fund said in a statement on Thursday.”
The sharp depreciation of sterling has forced investors to look for alternative investment opportunities, which in turn has pushed up the dollar,” it said.”
With the global economy in a fragile state, the weaker dollar means a cheaper dollar is no longer an alternative, and a weaker sterling has led to a weaker dollar.