Silver lining for Irish exports as euro continues to weaken
The euro continues to weaken against the US Dollar and Sterling in the face of the Greek crisis.
In recent days the euro has fallen against the Dollar and the latest euro to Dollar exchange rate converts at €1 to $1.11.
This is a fall from $1.14 in June 22 according to the latest exchange rates. Today (Wednesday) Greece and European leaders are sitting down to discuss the situation. Shares across Europe fell as early reports from the meeting said Greece claimed its creditors were not accepting its proposals on a deal.
EU leaders have said they won’t negotiate on Thursday, so a deal must be reached today or tonight.
Looking to the UK, the latest exchange rate converts at €1 to £0.71; a drop of one pence from June 22. In January the euro was worth £0.78.
Bloomberg reports that if Greece defaults it would put increased pressure on the euro and push it much lower.
It says that everything points to a potential much lower euro from here. Other reports suggest that the weakening is not over, despite recent efforts to hammer out a deal.
The weaking euro though is good news for Irish exporters. Bord Bia said recently that the recent weakening of the value of the euro is helping to boost the competitiveness of Irish exports.
More than 40% of food and drink exports are destined for the Sterling area and a further 29% go to markets which predominantly trade in US dollars.
Bord Bia also says that any change in exchange rates has the potential to impact on the competitiveness of Irish food and drink exports.
While the Central Statistics Office (CSO) export figures for June are not available yet, the latest export figures for April showed Irish exports to be at an all-time high.
Between March and April 2015 exports increased from €8.3m to €9.3m; an increase of €1m in the space of a month.
The CSO figures show an increase of €2.5m from the €6.8m in exports in April 2014.