| Author: | MacKinnon, N. |
| Title: | Prospects for the UK economy |
| Journal: | Economic Affairs
1994 : WINTER, VOL. 15:1, p. 26-28 |
| Index terms: | ECONOMIC CONDITIONS UNITED KINGDOM EXCHANGE RATE MECHANISM |
| Language: | eng |
| Abstract: | Developments in the UK economy have turned out to be markedly better than assessments made a year ago. The recovery itself occurred in spite of , rather than because of, government economic policy. The devaluation of sterling and the subsequent two-thirds reduction in interest rates proved to be just the ticket to ensure the release from the high interest rate clutches of the Exchange Rate Mechanism. The breakdown of the "old" ERM was essentially a story of interest rate misalignment rather than exchange rate misalignment. |
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