Dipping again, £1 = €1.09... Only a matter of time now lads. Economically in the short/medium term the UK is like a boxer - dazed and swinging on the ropes, the defeat (in this case slipping below 1:1) is inevitable, it's just a question of when.
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So...if I have bank accounts in Northern and Southern Ireland is it a good idea to have my wages (I work in Dublin)/savings paid into my Northern account given the favourable exchange rate?Comment
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It depends, I assume you are paid in Euros, not sterling ?
If you are paid in Euros and most of your daily expenses are in Euros then you should have your wages paid into a Euro current account since that is the account which will be most active.
In terms of savings it would depend on the projected maturity of your investment (i.e. the length of time you intend to be saving for). I think Sterling will continue to fall vs Euro (or will fail to significantly rise) for at least the rest of 2009. So if your time frame is less than 6 months you are as well to keep your savings in Euros. However if you are investing for a longer term (3-5 years) then you could look at converting your savings accounts from Euros to Sterling when it reaches 1:1 or lower. The theory behind this is Sterling should rise to it's natural level (1.20 or 1.30) over that time frame - but that is an inherently risky prediction.
You might instead want to look at investing in Sterling denominated alternative investments (such as natural gas trusts) or even Sterling property (i.e. British housing) as these would probably be safer bets than currencies alone. Also most saving accounts give paltry rates at the moment, so you could wait and see for a bit longer. If you want to buy electronics / white goods or go on holiday, you will get a lot of value for money if you hop over the border or on a ferry in the next few months.Comment
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