Published by Mark Smith-HalvorsenThe pound fell to a fresh 14-month low against the dollar in trading yesterday (May 17th) and remains fragile this morning.The slump came after the chancellor of the Exchequer George Osborne told the Financial Times that the previous Labour government had 'fiddled' forecasts to present a picture of the UK economy that supported their policies.His comments came ahead of a scheduled emergency Budget due to take place on June 22nd. The coalition has agreed to the Conservative's manifesto pledge to make £6 billion in cuts in order to bring the deficit back under control.The move is intended to restore confidence in the UK economy and sidestep the sovereign debt crisis spreading throughout Europe.Hans Redeker, an analyst at BNP Paribas, commented: "Sterling is expected to be increasingly exposed to the sovereign debt crisis as international bond portfolio managers turn their back, not only on European bonds, but on UK assets as well."For more information on foreign exchange treasury services and risk management, visit our Corporate FX site