THERE were audible sighs of relief from boardrooms last week as the pound slipped towards the 2.90 Deutchmark level. If your product or service is exportable, the strength of sterling in recent months has been a growing frustration, knocking disturbing holes in demand, margins and the bottom line.
There were fears, in the immediate wake of the political fix in Brussels over the presidency of the European Central Bank, that the pound, as the leading stay-out currency within the European Union, would face increased demand in foreign exchange markets, as speculators and dealers sought refuge from the ensuing uncertainty over what kind of Euro we can expect. Scotland's exporters were bracing themselves for a further upward push on the pain meter.
So far it hasn't happened. If anything, the pain has eased slightly. Instead of strengthening against those European currencies poised to adopt the Euro, sterling began to slide. And Mr Wim Duisenberg's tough talking at the European Parliament - where the new central bank's first president-elect made it perfectly clear he may not quit his eight-year term early just to placate the French - will help to stiffen market sentiment in the days ahead.
But these are uncertain and potentially turbulent times in world currency markets. The ripples from the Asian financial crisis continue to spread. A new generation of corporate giants, whose operations span continents, whose financial clout dwarfs that of dozens of the world's small, even medium-sized, nations, are in the making. Internet commerce, which knows no borders, continues to grow, albeit from a small base.
The world of nation states each with its own sovereign currencies traded freely against others is evolving into new and different forms. One of the most significant evolutions will be upon us next January, when 11 European Union member states, including Germany and France, pool their marks, francs, lire and pesetas and a significant slice of their economic decision making into the Euro and the single central bank Mr Duisenberg will preside over.
Any more fudges like that over his appointment - coupled with the very real possibility that the key architect of monetary union, Helmut Kohl may fail, this September, to be re-elected for a fifth term as German Chancellor - and the launch of a Euro weakened by political compromise and national horse-trading will invite instant speculative attack.
Here in Britain, even those who have experienced the painful challenge of exporting against a sharply rising pound might be tempted to smile quietly and bless both Mr Major and Mr Blair for keeping us on the Euro sidelines.
But, in or out of European Monetary Union, there are very real consequences for sterling, whether the new single currency turns out to be strong enough to rival the dollar or a political dud, tested to destruction on trading screens around the globe.
If the Euro gains strength and Mr Duisenberg's bank apes the Bundesbank in its uncompromising distaste for inflation, the pressure on Britain to take the pound in could quickly become irresistible. If the Euro proves weak, the political fall-out in the rest of the European Union will undermine markets there and the pound could face a renewed period of accelerating demand.
In or out, there is no real hiding place. And even if the new currency reality settles somewhere in the middle of these extremes, British exporters will have to realise that not everyone suffers from a high pound. Importers obviously don't.
And with so much that we buy in the shops - from January strawberries to ethnic furniture - now sourced in every corner of the globe, there are plenty of retailers who welcome the pound's relative strength. Britons travelling abroad like it too. And those businesses, like oil, which trade around the world in one dominant currency, don't really care.
If the pound stays strong or gets even stronger, our hard pressed exporters will have to find other means of staying competitive.
British exporters will have to
realise that not everyone suffers from a high pound.
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