Today's slump marked the seventh consecutive day of falls for the pound since the Bank of England slashed the base interest rate to 0.25 perent last Wednesday. At noon today the pound was at its lowest against the dollare for 35 years.

But despite the slump analysts at UBS believe the UK will make up some ground in coming months.

Thomas Flury and Dean Turner, of UBS Global Wealth Management, said: "The level of fiscal-monetary coordination by the UK government and the Bank of England strengthens our conviction that sterling is set for a rebound once the global economy stabilises."

Experts said the pound had nosedived because traders had been switching from sterling to other major currencies as the markets assessed the wide-ranging economic impacts of the coronavirus pandemic.

The US Federal Reserve has relaxed the terms on which it provides currency swaps to five of the world’s major global central banks, making it easier for them to provide dollar funding to financial institutions.

UK stocks also suffered a torrid morning as makor stimulus plans on both sides of the Atlantic failed to ease fears about the economic impact of the coronavirus pandemic.

The FTSE 100 index of top UK firms dived more than 5 percent, with aerospace firms, travel companies and housing firms leading the declines.

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