Weak euro helps food exporters
A euro slide has taken the currency to a 22-month low, relative to sterling, with €1 worth 81.3p so far this month.
The decline reflects sovereign debt concerns in eurozone economies, and political uncertainty. In 2008, the euro appreciated to a high of 98p and has remained relatively strong since. But since 2009, its trajectory has been generally downwards.
An analysis of the average currency forecasts of about 40 foreign exchange analysts, compiled by financial news provider Bloomberg, show an average forecast from April to October this year of €1 at 82p. From next Oct to Apr 2013, the average forecasted exchange rate is €1= 81p.
Behind the averages are some very divergent predictions. But none of those surveyed foresaw the value of the euro rising above 90p — and forecasts went as low as 70p.
The weak euro boosts Irish exports to the UK, which takes about half of our main food exports — but it makes imports of non-EU farm inputs more expensive.
The euro still remains relatively strong compared to its levels against sterling in 2007, when it was worth only 66p.
