Green Pound revaluation is touch and go

By FWi staff

A REVALUED Green Pound is still a possibility – but only just. Sterling has weakened considerably over the past fortnight and this afternoon (Tuesday) fell out of the revaluation zone altogether.

The Pound closed at DM2.989 against the Deutschmark yesterday (Monday). By midday today, it had fallen further to DM2.985.

The Real Monetary Gap – which has to be above 5% if a revaluation is to go ahead – was reduced from 5.100% to just 5.060%.

If Sterling remains at or below current levels between now and Thursday, a revaluation could be avoided.

Such a reversal of fortune looked unlikely on March 13 when Sterling entered its first 10-day confirmation period. But a revaluation on 3 May now hangs in the balance.

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