Recently the foreign exchange reserves in the UK increased dramatically. Explain how and why this situation came about and what risks does the UK face from currency intervention? And Include Havard Refrence format?
2007-08-24 07:14:47 · 2 answers · asked by Jason S 1 in Business & Finance ➔ Other - Business & Finance
It sounds as if The Bank of England has been selling sterling again!
They do this to stabilise exchange rates and following the decision to cut rates in the US they may have been looking to keep the £/$ rate near the $2 level.
http://www.bankofengland.co.uk/financialstability/internationalfinance/index.htm
2007-08-24 07:29:48 · answer #1 · answered by 'Dr Greene' 7 · 0⤊ 0⤋
Most likely we have sold £££ and purchased $$$ .... plainly the main risk is that the $/£ ratio moves against us ...
2007-08-27 10:06:24 · answer #2 · answered by Steve B 7 · 0⤊ 0⤋