THE pound's standing on foreign exchange markets was undermined

yesterday by the row over voting rights in the European Union.

Sterling lost two pfennigs to DM2.4844, its lowest level since

October, and 0.72 cents to $1.4893.

With local elections in May and the European elections in June, the

City fears that the pound will remain in the doldrums for a couple of

months, reducing the Government's scope to cut interest rates to offset

the #8000m of tax increases about to come into effect.