A strong pound gives luck Ken a window of opportunity

Article Abstract:

The recent rise in the value of the British pound will have a practical impact on the economic policies of chancellor Kenneth Clarke. Many observers believe that there will shortly be an increase in interest rates as economic growth speeds up. This will have the effect of partially tightening monetary policy, temporarily improving the current account and reducing the price of imports, thus cutting inflationary pressures. A rise in the exchange rate may be associated with an increase in the room for tax cuts in the forthcoming Budget.

Analysis, Economic policy

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What to expect if the strong pound is here to stay

Article Abstract:

UK interest rates are likely to continue rising throughout the rest of 1997 if consumer demand continues to rise strongly. Indeed, interest rate rises may not reach their peak until the middle of 1998 at the earliest. It is now widely accepted that the UK will have high nominal interest rates for at least the next few years. It is likely that sterling will remain strong throughout this period, and possibly even longer if European monetary union continues to create problems for continental European currencies.

Interest Rates, Forecasts and trends

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Of pride and a falling pound

Article Abstract:

In 1931, when the gold standard was the international anchor, several European currencies were devalued and banks had loan losses. Britain left the gold standard and imposed exchange controls. The bank rate was increased twice. The Labour government fell. In the 1992 devaluation, world recession is reduced compared to the 30's, world debts are lower and the international banking system and governments are more secure.

United Kingdom, History, International economic relations, Gold standard

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