British pound stabilizes, but turmoil still roils UK economy

By DANICA KIRKA, JILL LAWLESS and SYLVIA HUI
Associated Press

LONDON (AP) — The British pound has stabilized as U.K. authorities tried to ease investor concerns after the biggest tax cuts in 50 years sent the currency tumbling to a record low. Some businesses are predicting a devastating combination of a weak currency and rising interest rates. The turmoil is already having real-world effects, with British mortgage lenders pulling hundreds of offers from the market. That’s because there are expectations the Bank of England will sharply boost interest rates to offset the inflationary impact of the pound’s recent slide. The Wine and Spirit Trade Association says the sterling crash is set to raise prices for consumers and threaten hundreds of British jobs in bottling plants.