Sterling fall 'bad news' for Irish farmers
A weakening Sterling has potential to wipe €50m off exports, writes Caitriona Murphy
Published 02/11/2010 | 05:00
The threat of a further weakening of sterling against the euro is "unambiguously bad news" for Irish farmers, one of the country's leading economists has warned.
Sterling could move back into the 90-95p/€1 range quickly, Jim Power from Friends First has said.
Mr Power warned that as quantitive easing gathered momentum in the United States over the coming six months, the dollar would weaken and there was a strong possibility that sterling would follow the dollar down.
"Quantitive easing basically means the US government is printing more money and that is undermining the dollar," he explains. "Sterling tends to follow the dollar."
The economist suggested that sterling could weaken to the 90-95p/€1 "pretty quickly".
"From an Irish agriculture and food point of view, this is unambiguously bad news," he pointed out.
"The UK is the biggest export market for Ireland and a weakening of sterling would make Irish food exports less competitive and make UK imports into Ireland much cheaper," he said.
"At the moment in Ireland, it seems that anything that can go wrong, will go wrong," he said wryly.