Roger Bootle in the Telegraph thinks so. He says that past governments have seen the economy falter as exports got damaged by the high pound. He says that although the BOE won’t officially be able to place a cap, due to our obligations as part of the G7, they should place one in an informal manner and intervene when the risks to exports rise.
While he makes some good points about the benefits of a weaker pound to the economy the problem we face to our export industries goes further than just the currency level. Our biggest trading partner across the channel is still weak economically and there no real demand there whatever the price of sterling. Personally I think we’ve got more chance of winning next years World cup than seeing the pound capped
Full story from the Telegraph here.
Do you think that capping the pound would help our economy and would it give speculators a nice fat target to aim for?
Pegging the pound? Two hopes, Bob and No.
