Sterling dropped by 2.3 cents against the dollar to $1.5014, while the euro strengthened to back above the 90p level, reversing most of the improvement in recent days. The pound had been boosted earlier this week by unexpectedly strong employment figures and by a surprise rise in tax revenues in February. But although Treasury sources insist that the likely shortfall in borrowing will not be used to fund a pre-election giveaway, the government debt market stuttered yesterday, with traders mulling the prospect that the improved public finances could increase the likelihood of a Labour victory at the polls.   Related Articles Four reasons why Gordon Brown may cut taxes Asian stock markets gain as China wobbles ease, oil jumps Local newspaper owners need to learn from Sir Ray Tindle Investing in a recession: 10 tips British Airways to raise £600m as it reports £100m loss Duncan Higgins, senior analyst at Caxton FX said: "Thursday's data was certainly encouraging and does point to a slight improvement in the fiscal state of the British economy.[Read more...]