Re: Re: Pound above 1.2 Euros for first time since November 2008


Whilst I have felt that sterling would appreciate in value it is very difficult to predict by how much and over what period.

My gut feeling is that the pound will not return to the dizzy heights of 1.50. The reason for this is that the economies of the UK and the Eurozone are closely intertwined. If the rate of growth in the eurozone remains stagnant then this would have a negative impact on the UK and its rate of growth (that doesn’t mean to say that the UK couldn’t exploit other markets to achieve growth – it just takes time to do so). The rate of growth is one of those variables that affect the value of the pound. Also I feel that the government would probably not wish to see the pound significantly appreciate against the euro because that would make imports from that trading bloc cheaper and ours more expensive. This again would affect our rate of growth.