British Pound Hits Record Low Against Dollar

The British pound hit its lowest-ever level against the U.S. dollar Monday, dropping heavily after the U.K. government announced a series of tax cuts on Friday, before later paring losses.

The currency touched $1.0349 during Asian trading hours Monday, breaking through its previous record low in 1985. The pound was recently trading at $1.0776.

The currency sold off dramatically after U.K. Chancellor of the Exchequer Kwasi Kwarteng unveiled a massive tax-cutting package Friday, which will be paired with subsidies for households and businesses.

"I'm always calm," Mr. Kwarteng said Monday. "Markets move all the time. It's very important to keep calm and focus on the longer term strategy."

The U.K. government is planning to issue large amounts of bonds to help fund its spending, which has sent yields on existing debt soaring. Yields continued to climb Monday.