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An Examination of Irish Currency Policy. ESRI Policy Series No. 18. October 1993

Honohan, Patrick (1993) An Examination of Irish Currency Policy. ESRI Policy Series No. 18. October 1993. [Policy Paper]

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    The signature of the Maastricht Treaty, which was intended to usher in currency stability by transforming the European Monetary System (EMS) into an Economic and Monetary Union (EMU) with a single currency, was instead followed within months by the worst currency crisis for two decades. Ireland was hit by the crisis as badly as any region in the Community and the whole experience had already brought the issue of currency policy to centre stage when, at the end of July 1993, the EMS quite suddenly collapsed under pressure of a new wave of speculation directed mainly against the French franc. This paper reviews Ireland's experience in the EMS and asks whether any changes in currency policy are suggested by recent events. Increasing complacency about the stability of the system over the past five years led to realignment policy within the system becoming too rigid. Its last months highlighted the weaknesses of such a system from Ireland's point of view, including its vulnerability to speculation and the volatility which it entails for the Irish pound-sterling exchange rate.

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    Item Type: Policy Paper
    Subjects for non-EU documents: EU policies and themes > Policies & related activities > energy policy (Including international arena)
    Countries > Ireland
    EU policies and themes > Policies & related activities > economic and financial affairs > fiscal policy
    Subjects for EU documents: UNSPECIFIED
    EU Series and Periodicals: UNSPECIFIED
    EU Annual Reports: UNSPECIFIED
    Series: Series > Economic and Social Research Institute (ESRI), Dublin > ESRI Policy Research Series
    Depositing User: Alyssa McDonald
    Official EU Document: No
    Language: English
    Date Deposited: 14 Jul 2017 19:25
    Number of Pages: 78
    Last Modified: 14 Jul 2017 19:25

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