The sterling effective exchange rate is one reason why the UK has recorded the highest inflation rate of any advanced economy.
With the onset of the crisis, the Bank of England allowed sterling to depreciate dramatically in 2008-9.
The depreciation was supposed to spur export led growth, and eventually dig the UK economy out of its current hole.
It hasn't happened. Instead, import prices rose, living standards fell, while the economy has flat-lined for almost five straight years.
Tag :
UK,
UK economy
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