With just 8.40 francs to the pound this week, it is possible to look back to 1971 when there were 13.40 francs to the pound. But just six years later the pound had fallen to 8.57 - roughly its current level. It may provide some encouragement in the present situation to note that by 1984 the pound had recovered to 11.63 francs.
Since 1984 the pound has been in almost steady decline against some currencies, like the Swiss franc, the German mark and the Austrian schilling.
The pound/US dollar rate has had a see-saw existence for 20 years: dollars 2.44 in 1971, dollars 1.74 in 1977, dollars 2.32 in 1980, dollars 1.29 in 1985, dollars 2 earlier this month and dollars 1.70 this week.
For a real dose of depression, consider the yen rate (857 to the pound in 1970, 205 this week), or that of the Swiss franc (10.32 in 1970, 2.23 this week) and the German mark (8.73 in 1970, 2.56 this week).
The key exchange rate for tour operators were the rates on 21 July, the day on which they fixed their summer 1993 brochure prices. Downward movement of the pound against these rates could cause severe financial problems for operators who have failed to buy currency ahead. On 21 July, for example, there were 182.5 pesetas to the pound compared with 173 this week; and dollars 1.91 to the pound compared with dollars 1.70 now.
The most damaging effect of the currency shift, however, is that it will discourage people from booking foreign holidays. Despite the cut in interest rates, there appears to have been no increase in business and the market continues to remain very depressed.
The one beneficiary of the exchange rate movement is likely to be the British tourist industry. The British Tourist Authority chairman, William Davis, says that the decline of the pound will encourage tourism from overseas, particularly from America and Germany.
'The shift in exchange rates will provide no instant miracle,' Mr Davis said, 'but for our beleaguered tourist industry this is good news.'Reuse content