# If Ireland defaults



## pattel (28 Feb 2011)

What will happen to the value of the pound if Ireland defaults.


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## PaddyBloggit (28 Feb 2011)

I'd be moree worried about my Euro than the pound.


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## horusd (28 Feb 2011)

pattel said:


> What will happen to the value of the pound if Ireland defaults.


 
Interesting question, it's not obvious that an (unlikely) default would be entirely negative for the UK although the £ would likely fall in value.

I would imagine it would depend on the nature of the default (ordered or catastrophic),the scale of UK exposure to Ireland, and the potential impact on UK exporters as we are such a large market for them etc. Also should the £ devalue, this would make UK exports better value.


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## csirl (28 Feb 2011)

Depends on the type of default.

Are we talking about the Irish Government not being able to pay it's own core debts or are we talking about the Irish Government allowing Anglo to go under?

If it's Anglo, the UK will take a hit as it would mean a fire sale of trophy properties in London. German pension funds would also be hit very hard.

If is the Irish Government, then the impact would be spread more evenly through the EU.


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