Pound Under Pressure As Cameron Delays European Statement

defenders07:30 Friday 18th January 2013
Bigger Breakfast Show
BBC Radio Cambridgeshire

[P]AUL STAINTON: David Cameron is due to give that update on that Algerian situation. He’s cancelled an important speech on Europe he was about to deliver today, but not in time to see the pound drop hard against the euro. Is it because of that, Mike Miller? Because he’s cancelled the speech? Or is it because of what he was perhaps going to say
MIKE MILLER: Yes, well it’s a bit of a combination of both. Basically, to cut a long story short, the pound has hit a nine month low. It’s down below one twenty now, which, if nothing else, makes it more expensive to go on holiday on the Continent. Because that one twenty, that’s wholesale prices. So you’re going to get much less than that once the dealers have taken their cut. The key word is uncertainty. We’ve got things like the UK’s triple-A credit rating on the line. But The UK’s own position on the EU is unclear. It’s now even potentially even more unclear, because that speech didn’t go out. We do know that David Cameron said that there’s a danger that the British public will drift towards the exit. And all these uncertainties, people are saying that we just don’t want to be a part of this, and that means they’re getting out of sterling, and that’s pushing the value down.