Thursday, 23 June 2022

scheduled territories

Also known as the above legal entity the sterling area came into being in 1931 when the pound was unpegged from the gold standard and a number of countries, mostly Commonwealth nations, either employed the £ or had a fixed rate of exchange with it, effectively came to an end on this day in 1972 when the British government unilaterally applied exchange controls to all its participants—with the exception of the Republic of Ireland, the Isle of Man and the Channel Islands—with the departure of forty-five members from the economic bloc in protest of UK monetary policies. Once the most robust and coherent currency areas, the realisation trade with the continent was more important that historical preferential trading with former parts of the empire prompted the UK to seek closer ties with the European Communities—the Common Market—and devalued, floated the pound ostensibly to halt outflow and flight to the US dollar but many saw it at the time as a concession to France’s objection to UK membership in the organisation that would go on to become the European Union, which repealed its veto the following year. Coincidentally, this day also marks the 2016 anniversary of the Brexit referendum.