Sterling slides after UK downgrade The pound hit a fresh two-year low on Monday after Moody's, the rating agency, stripped the UK of its triple A rating late on Friday night. Sterling slid against the US dollar to hit $1.5073, its weakest level since the summer of 2010, as investors reacted to the downgrade of UK debt by one notch to Aa1 from Aaa. The move came amid heavy losses already this year for the pound, which has suffered from waning haven demand for sterling as confidence in the eurozone has improved. Concerns that the Bank of England could add to its monetary easing programme in an attempt to boost the UK's sluggish economic growth have also weighed on the pound, sending it to its lowest level in two years last week. Figures released on Friday night by the US Commodity Futures Trading Commission showed that traders had increased their negative bets on the pound last week. Selling sterling has become one of the most popular trades for currency hedge funds this year. Currency analysts said that much of the effect of the downgrade had been priced into sterling already, after all three main rating agencies put the UK on negative watch last year. The downgrade was expected and priced into credit markets. Hence, we expect only a limited currency response in the short term," said analysts at Morgan Stanley. The pound stabilised against the US dollar in morning trading in London to trade just under $1.5150. But analysts also said the downgrade could add to the role of a weaker pound in aiding the UK's economic recovery, with members of the Bank of England's Monetary Policy Committee hinting recently that a depreciation in sterling would help UK exporters.