European finance ministers are planning to round on Alistair Darling and tell him to bring the pound back under control, in what many fear could represent the opening salvo of a "currency war".
French and German ministers are expected to confront the Chancellor over sterling's weakness at the opening dinner for the Group of Seven finance summit in Rome tonight. They will ask him to consider direct action to increase the value of the pound, which has suffered its worst devaluation since at least the final breakdown of the Bretton Woods agreement in the early 1970s.
It came as the pound dropped further against a range of currencies, following the Bank of England's unexpected acknowledgement earlier this week that it plans to start buying gilts imminently as part of its quantitative easing efforts. Sterling fell more than a cent against the dollar to $1.4248, although it did strengthen marginally against the euro. >>> By Edmund Conway, Economics Editor | Friday, February 13, 2009
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