George Soros, the multi-billionaire investor, today said that speculators are facing higher risks when betting on the weak pound following its plunge over the past year.

Mr Soros, who became notorious for making billions by “breaking” the pound and Bank of England in the 1992 crisis over the European exchange rate mechanism, admitted today that until recently he had been betting against the pound.

But in a boost for the still-vulnerable currency, which remains under intense pressure on the foreign exchanges, he said that he was no longer taking out currency market bets on a cheaper pound against the dollar, and “short-selling” sterling.

Implying that the pound may now have fallen too far, or at least reached a trough, Mr Soros said that at levels for the pound below $1.40, the risks of betting against sterling now outweighed the potential rewards that might be reaped.

“It seemed to me that the risk-reward [trade-off] no longer makes it clear which way we should go at this. While we did have a short position on sterling, it does not mean that I am ‘bearish’ today, but it does not mean that I’m bullish either.”

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