Will we see parity between the Euro and the Pound

[jas72]

The Pound has been slipping badly against the Euro for some months now.

The current rate is 1.25€ to the pound compared to 1.34€ in January 2008 and 1.48€ last July.

So with the current economic climate and Britain's pound strong due to it's financial markets do you think we could see

A) Pound for Euro

B) Move by labour for a switch. (I mean what better time to ask when they are worth the same anyway.)

PS I'm loving it I just bought 2 PS3 games for 60 quid which is 76 euros. Cheapest I could get them here was 100€

 

[fini]

I think Europe's not yet been as affected by the sub-prime crisis as the UK has. As such, Europe, as a whole, is fairing better than the UK and this is reflected in the currency shift. Whether we see parity is purely down to the economies ability to move out of this downturn. I'm disappointed with the Bank of England only moving the interest rate .25% today (was hoping for .5%) so the answer, for me would be perhaps. If it does happen I don't think it'll happen by the end of this year though.

 

[Morba]

Shame most places wont also cut their base rates for lending.

 

[scorza]

Weak pound = good news for our economy imo. Should increase sales and exports. Only concern is inflation but an even weaker dollar will help mitigate that.

 

[Mad old tory]

Only trouble being we are very reliant on imports, which are becoming more and more expensive from the €zone at least.

 

[fini]

Luckily, however, most our imports come from countries still trading in $ and, as such, it mitigates that problem.

 

[daz]

Luckily, however, most our imports come from countries still trading in $ and, as such, it mitigates that problem.

Imports
Germany 12.8%, US 8.9%, France 6.9%, Netherlands 6.6%, China 5.3%, Norway 4.9%, Belgium 4.5% (2006)

https://www.cia.gov/library/publications/the-world-factbook/geos/uk.html

 

[fini]

When all those figures add up to less than 50% they're pretty meaningless..

 

[daz]

Well out of the 7 countries we import the most from, 6 of them use the Euro.

 

[scorza]

Only trouble being we are very reliant on imports, which are becoming more and more expensive from the €zone at least.

Hence why we will be less reliant on imports in the future, as British produced goods will be cheaper than those produced in the euro-zone.

 

[scorza]

Well out of the 7 countries we import the most from, 6 of them use the Euro.

Huh? US, China and Norway don't use the Euro so only 4.

 

[meghatronic]

https://www.cia.gov/library/publications/the-world-factbook/geos/uk.html

A lot of companies don't trade in the Euro though..

 

[jaykay]

https://www.cia.gov/library/publications/the-world-factbook/geos/uk.html

Just reading on that site.

Current account balance:
-$111 billion (2007 est.)

Is this really true?

revenues: $1.155 trillion
expenditures: $1.237 trillion

I never knew we were so much in debt. Or is this normal?

 

[Tefal]

Hence why we will be less reliant on imports in the future, as British produced goods will be cheaper than those produced in the euro-zone.

Why would they be cheaper?

When we've closed all our factories and moved them abroad?

 

[Rossmac]

I'm also loving it, my placement for Uni has been in Dublin, and exchanging the Euros to Sterlings is great these days Went and exchanged €1250 yesterday and got £1000. It was epic...

 

[Cosimo]

I never knew we were so much in debt. Or is this normal?

It is for the UK, the country is up to it's neck in it, just watch the bubble burst.

 

[scorza]

Why would they be cheaper?

When we've closed all our factories and moved them abroad?

I should have said, they will be cheaper than euro-zone products, which are now more expensive than they used to be for us.

It's not all about factories (we do still have a few).