§ 4. Mr. Campbell-Savoursasked the Chancellor of the Exchequer when he expects to reply to the fifth report of the Treasury and Civil Service Committee on exchange rate policy.
§ The Economic Secretary to the Treasury (Mr. Ian Stewart)I refer the hon. Gentleman to what my right hon. Friend the Chancellor said about the exchange rate in his Budget statement.
§ Mr. Campbell-SavoursWhy should the Government have intervened when the pound fell below $1.10?
§ Mr. StewartIntervention in exchange markets was discussed in the G5 meeting, when it was decided that coordinated intervention by several Governments might be useful as and when conditions made that necessary.
§ Mr. MaplesDoes my hon. Friend agree that a period of sustained dollar weakness might cause just as many problems as the recent dollar strength? Might it not now be in our interest to participate fully in the exchange rate mechanism of the EMS?
§ Mr. StewartI am not too sure about the relationship between the two parts of my hon. Friend's question. I do not believe that under present conditions it would be right for us to join the exchange rate mechanism of the EMS. With regard to the weakness of the dollar to which he has referred, it might be a little early to pass judgment on that phenomenon.