Exporters feel pain as sterling falls
STERLING'S fall against the euro is "catastrophic" for exporters and has ushered in the worst period in living memory for most indigenous exporters, John Whelan of the Irish Exporters' Association (IEA) said yesterday.
The comments came as the British pound fell to the lowest level in more than six months against the euro after a business lobby group said the Bank of England should expand its asset-purchase programme which is sometimes called quantitative easing or printing money.
"If sterling's valuation continues to be undermined by the Bank of England's quantitative easing process, then serious long-term damage will be done to the indigenous export sector in Ireland and the jobs that depend on it,'' Mr Whelan said.
Irish exports to the UK fell 23pc in the third quarter compared with the same period last year, according to IEA figures. The association has identified 27,400 jobs that are vulnerable to the fall in sterling.
Mr Whelan said the Government's Employment Subsidy Scheme fund should be urgently paid to approved companies. Present restrictions prevent many companies from using the fund, he added.
Sterling hit 94p per euro yesterday for the first time since late March after the British Chambers of Commerce said the Bank of England should extend its £175bn (e187bn) bond-buying programme by £25bn. Analysts at Swiss bank UBS cut their forecasts for the pound, saying the bond-buying programme will probably be expanded.
"Sterling is going to remain fairly weak. The UK economy is going to be lagging behind the global recovery," said Hans-Guenter Redeker, head of global currency strategy in London at BNP Paribas.
The currency will end the year at 90p per euro, according to economists and strategists' forecasts polled by Bloomberg. Declines may be limited as the economy recovers.
The UK housing market strengthened in September as the proportion of surveyors and real estate agents reporting higher prices rose to the highest since May 2007, the Royal Institution of Chartered Surveyors said.
A report from the British Retail Consortium showed sales at stores open at least a year rose 2.8pc on an annual basis, the most in five months.
- Thomas Molloy
Irish Independent
