The pound has fallen to its lowest level against the U.S. dollar since decimalisation in 1971

The British pound has fallen more than 4 per cent before regaining some ground to $1.05.

It follows UK Chancellor Kwasi Kwarteng delivering his mini-budget, where he stood firm that the UK can’t borrow forever.

“Our plan is to expand the supply side of the economy through tax incentives and reform,” he said.

Historic tax cuts funded by huge increases in borrowing were at the centre of the budget. It’s understood the permanent tax cuts are nearly 2 per cent of overall gross domestic product.

“We’ve got to grow the economy. We’ve got to have a much more front-footed approach to growth” Kwarteng said.

If the pound stays at this low level against the dollar,

The record drop could mean some imports of commodities, which are priced in dollars could be felt across the UK, including purchases of oil and gas.