Sterling plummeted over 3 cents against the dollar to $1.6375 and 2 cents against the euro to €1.0890, following the release of UK GDP data from the Office for National Statistics.
Mark O’Sullivan, director of dealing at foreign exchange firm, Currencies Direct, said: “Today’s GDP figures have caught the market off guard causing sterling to slump against both the dollar and euro.
“This week’s fairytale rally for sterling has been stopped dead in its tracks. With cold hard data underlining a distinct lack of growth in the UK economy, aggressive sellers are returning to the market once more.”
UK third quarter GDP came in at -0.4% quarter on quarter and -5.2% year on year. Median forecasts had predicted a rise of 0.2%, -4.6% respectively.