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Sterling: no solution

But would a weaker pound really be so bad? Conservative MP John Redwood thinks not. He said: “If the pound really did fall there’d be a big boost to exports and reduction in imports and a lot of the balance of payments problem would go away.”

This is too optimistic. A fall in sterling would not do much to close the trade deficit, simply because export and import volumes do not respond very much to price changes.

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