Pain for exporters: sterling was stuck near a 14-month low, despite strong data on retail

  • Pain for exporters: sterling was stuck near a 14-month low, despite strong data on retail
    FarmIreland.t. E.
    Sterling languished near a 14-month low on Thursday, and strong retail sales in the UK were unable to support the currency suffer due to fears of the UK leaving the European Union.
    https://www.independent.ie/business/farming/agri-business/agri-food/pain-for-exporters-sterling-stuck-near-14month-low-despite-strong-retail-data-37222865.html
    https://www.independent.ie/business/article36463771.ece/2e8f6/AUTOCROP/h342/2018-01-07_bus_37487431_I1.JPG

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Sterling languished near a 14-month low on Thursday, and strong retail sales in the UK were unable to support the currency suffer due to fears of the UK leaving the European Union.

Hot weather and world Cup on the growth of retail sales in July, but the pound held steady against the dollar at $ 1.27.

A strong dollar and mounting fears that Britain will be unable to provide the agreement before he leaves the EU in March to hurt the pound.

He lost 12 pieces of its value since April and on Tuesday fell to $1.2662, its lowest level since June of 2017 fall against the dollar on the 12th day in a row.

Some saw the Bank of England interest rates early this month as a vote of confidence in the economy, since the future of Britain, and access to European markets is still a matter of doubt.

“Now the future of interest rates seems a distant prospect and the UK’s exit from the EU is still a matter of uncertainty… even in good economic performance is unlikely to be translated into strong impetus for sterling,” said Lee McDarby, Manager at Moneycorp foreign exchange brokers.

Pain for Irish exporters

The weak pound may represent good value for tourists who are traveling from Ireland this summer in the UK, but unfortunately for our domestic tourism industry, and this represents a serious risk for Irish exporters.

Bord Bia overseas trade Manager Shane Hamill reported that the decline of the pound sterling means more important to Irish exporters to find ways of hedging the British exit from the EU.

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“In 2017, 80pc of respondents of the barometer of the output of great Britain, Bord Bia reported that they face serious difficulties in the course of the 90-94p for Euro”, – he said.

“In 2018 is reduced to 55pc. While the value of the pound sterling remains a risk of growth exporters to some extent are to increase stability by limiting and recovery of growth costs from the market through the management of costs and prices.”

Gerard Reilly, Reilly mushrooms, Walderstown, County Westmeath, warned that 15 companies have already closed, since the output of the UK voted two years ago.

“The exchange rate currently is about 89c/90C against the Euro. This puts pressure on exporters,” he said.

“There were about 700 producers in Ireland in 2004, but is now only about 40.”

Mr. Reilly added that, as it exports 90pc of its products in the UK, hard British exit from the EU would be detrimental to his business.

“We continue to trade and grow the same amount, but we grow in a more nervous atmosphere.”

Meanwhile, Trevor McHugh, Director of forest company VeOn Ltd, said while exchange rate fluctuations have the ability to affect the competitiveness of Irish exporters, the exchange rate usually settle after the extreme.

“Currency moves up and down over the last two years. We have seen the extremes, but it usually ends up. Timber prices remain strong and there is demand in the UK for Irish food, since they can’t produce the timber they need,” he said.

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