§ Mr. Gouldasked the Chancellor of the Exchequer, in view of the comparatively 546W small net drain on United Kingdom reserves in the third quarter of 1976, to what he attributes the fall in the value of the £ sterling during that quarter.
§ Mr. Robert SheldonThe net fall in the level of the official reserves between end-June and end-September is a guide neither to the amount of official intervention nor to the extent of exchange market pressure which caused the further depreciation of sterling. Exchange market pressure in this period was associated in particular with the payments deficit and the further reduction in the sterling balances held by non-residents; this underlying pressure was exacerbated in certain phases by speculative selling from nonresident sources and, probably, some leading and lagging of commercial payments.