How much can the Irish Euro decline in value

[Daddy]

I read around that our Euro is going to be worth a lot less than currently.

This is not a question about inflation.

What will be the value of € 1 should

A. The IMF come in

B. We borrow from the ECB Fund

Basically will my Euro be worth less than a French Euro or should one be exchanging Irish Euros now for German Euros and at least it will then maintain it's current value.

Thanks

 

[jpd]

There is no such thing as an Irish €.

In case A) or B) as above, your € will be worth € 1, no more or less. But probably, a lot more people will lose their jobs, suffer pay cuts and Social Welfare cuts.

 

[Daddy]

Thanks.

So the value of my savings can not go down as long as the euro does not collapse ?

 

[Palerider]

The amount in your Euro savings account will not decline provied you live and spend it in this country however the value of the Euros or purchasing power can decline if we see inflation but that is always a risk, in my view your Euro will buy you more goods in a recession however if we see hyper inflation which is a possibility if the IMF actually step in then all bets are off and your deposit rate should rise.

You will see on other posts that deposits are being moved to other Euro countries that are seen as more stable, people do so to cover a risk of us being booted out of the Euro and having a devaluation of Euro deposits held here in IRL, personally I think this is unlikely but you cannot argue with the sense behind it.

 

[Daddy]

I see so the value of my euro will become much less if we get booted out of the Euro.

Could be time then to move my savings abroad.

 

[runner]

Yes, but its no longer called a euro in that case.
Re savings, maybe safer abroad but balance this against poorer interest rates.

 

[Chris]

The amount in your Euro savings account will not decline provied you live and spend it in this country however the value of the Euros or purchasing power can decline if we see inflation but that is always a risk, in my view your Euro will buy you more goods in a recession however if we see hyper inflation which is a possibility if the IMF actually step in then all bets are off and your deposit rate should rise.

You will see on other posts that deposits are being moved to other Euro countries that are seen as more stable, people do so to cover a risk of us being booted out of the Euro and having a devaluation of Euro deposits held here in IRL, personally I think this is unlikely but you cannot argue with the sense behind it.

How do you come to the conclusion that the IMF could cause hyper inflation here? Inflation is a monetary phenomenon, and the IMF have no power over monetary policies set by the ECB.
If you still had euros deposited here, after Ireland leaving the euro, they would be of the same value as the euros used in France or Spain.

I see so the value of my euro will become much less if we get booted out of the Euro.

Could be time then to move my savings abroad.

Only if at the same time all deposits within the country are automatically converted into the replacement currency, which I believe would be the first thing that would happen. In that case your savings would be safer abroad.