Importers hit as pound reaches record low against euro
Dec 17 2008
Businesses importing from Europe could be seriously hit as the pound plunges to an all-time low against the euro.
Following the cut in interest rates to two per cent, the pound has reached its weakest at 91p to one euro.
Sam Turvey, spokesperson for the British Chambers of Commerce, says: ‘For manufacturers importing from Europe this is extremely damaging news. And although there is a belief that this is good news for exporters, without the demand it is a false benefit.’
Jan Sanchez, owner of A1 Fruit, exports 20 per cent of her fruit to Europe and has seen little benefit to her business. ‘What we are experiencing is a lowered demand across the board, not just in Europe but also in the UK. So we are having to think of innovative ways to make our margins.’
Mark O’Sullivan, director of foreign exchange trader Currencies Direct, says: ‘This is likely to get worse as more investors lose confidence in the pound amid fears about the UK economy.’
Since the Federal Reserve’s rate cut to close to zero per cent yesterday, the pound has risen to $1.54.
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