§ Lord Tebbitasked Her Majesty's Government:
What disadvantages have befallen the United Kingdom economy consequent upon the exit of sterling from the exchange rate mechanism.
The Minister of State, Department of Transport (The Earl of Caithness)The initial impact of sterling's suspension from the exchange rate mechanism was a sharp fall in business and consumer confidence. But this shock to the economy has now successfully been reversed. Sterling's suspension from the ERM has enabled the UK interest rates to be set at a level consistent with the Government's objectives for low inflation and sustainable growth.