Parity between sterling and euro looks imminent: Britain is on sale. GBP 1 is worth a tad more than EUR 1.02. Given the small volume of trade, each (relatively small) transaction exercises disproportionate effect. It is unlikely that the pound will gain against other currencies any time soon, because prospects for the UK economy are not promising. The euroland will naturally have problems but Britain’s problems are probably more fundamental (see: UK recession How bad will it be?)
In any case, with the finance sector in turmoil and without a manufacturing base, the cheap pound should be used to lure shoppers from Europe and elsewhere to London and other British cities. For example, extra Eurostar trains for day-shoppers might a good idea.
Guardian: Pound edges closer to parity with euro
The Times: Pound edges closer to euro parity amid rate fears
Guardian: ‘90% discounts? Whatever next?’
European papers are noting that pound-euro parity is nigh: e.g. De Morgen ‘Britse pond en euro bijna evenveel waard’.