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Reuters reports that in early European trading, the pound was priced at $1.5647 against its US counterpart, having earlier dropped to $1.5560 on the Asian markets.
The fall, which took the British currency to its lowest level since late September, came as traders showed increased concern that other countries in the eurozone could be affected by the debt problems plaguing countries such as Ireland.
However, it has since recovered and Adam Cole of RBC Capital Markets was quoted by the news agency as saying the situation is "little changed from where we were last week".
"The issue of the peripheral countries will continue to bubble, but equally the market got too pessimistic about the US economy," he remarked.
Elsewhere on the currencies markets, Reuters reports the euro is close to a two-month low against the dollar, as investors focus on the possibility of further debt problems in the eurozone.
Posted by Greg Secker
