FOR SOME it’s great news – for others, it has potentially disastrous consequences.
But the slide of Sterling against the Euro in recent days is causing huge concerns in the tourism sector in Donegal ahead of the Easter break.
People working in the North will also see their tax-home pay cut, though it is better news for northerners working on this side of the Border.
On Friday Sterling hovered close to its lowest value for the year so far against the euro and was poised for further losses following concerns over UK economic growth and uncertainty over the timing of a Bank of England rate rise.
The single currency rose to 88.12p, its highest since 4 November, before easing to 87.85p, close to unchanged on the day. The single currency had narrowly extended its 1 per cent rise of Thursday.
Geraldine Concagh, economist at AIB Treasury Group, said: “The pound is under pressure. Weak retail figures, a dovish tone from the MPC minutes on Wednesday, (British Chancellor) George Osborne cutting the UK growth outlook and rate hike expectations being pushed back are all putting sterling on the back foot.”
That could put off tourists from the North and Britain in the coming weeks and months – and it’s one factor the industry here can do little about other than to continue to offer great holidays and value for money.
Beat Siegenthaler, currency strategist at UBS, said: “Jean-Claude Trichet (European Central Bank president] and others have made it clear that they will hike rates as intended despite news events around the world.
“The discrepancy between the BoE and ECB is pulling the euro higher against sterling. There is a good possibility that the euro can go as high as 90p.”
