Thursday, 19 February 2009

ECB on Sterling Devaluation

As I noted previously our EU partners are not happy about Sterling's slide which they see as a competitive devaluation in order to gain economic advantage. One Mr Bini-Smagi of the ECB is reported in today's DT as saying, "The integrity of the single market itself can be put at risk if the exchange rate is used - and seen to be used as an instrument to gain competitiveness at the detriment of others"

More worrying is Mr B-S's subsequent comment that he was pressing the UK to allow the ECB to become a pan-European financial regulator and he expected the UK to agree to such a deal that would give the ECB banking supervision powers throughout the EU.

If this happens we are f*cked! The City of London business will leak away to Frankfurt and Paris and London will become like Detroit.

The CBI yesterday said that Sterling's depreciation was not helping UK manufacurers as their wonderful EU market beloved of the CBI Europhiles was also in deep stuk! When the tide goes out you find out who has been swimming naked as Warren Buffet says!

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