NewStats: 3,264,080 , 8,182,529 topics. Date: Monday, 09 June 2025 at 03:09 PM 1a684o

Bede2u:
i take it you have researched it? Can you then tell us why the British pounds has more value than U.S dollars? Or why Kuwait's Dinah is stronger than British pounds? Just explain, no insults

Because the British run a tighter fiscal and monetary policy than the US which must run huge deficits as the reserve currency. I try?

Dtribeless:


Because the British run a tighter fiscal and monetary policy than the US which must run huge deficits as the reserve currency. I try?

lol you try and Kuwaiti Dinah?

Bede2u:
obviously everyone knows about stability and how it affects wealth, however if you understand the post, you will know it's about exchange rate than stability

Exchange rate means little. It can be set arbitrarily like many countries have done. Some have even rebased their currency but without the right fundamentals, the slide would only continue.

What matters is stability not the nominal exchange.
Its stability that determines the strength of a currency and investor confidence

Ahmback:
I dislike niggas like you who whine about the "made in China" shitty line. Made in China does not make it Chinese technology or product! Infact, China has none to minimal influence on the quality, quantity, method or techniques used in the production of these goods/products. It's just the labour

but those ceramic plates made in Nigeria by Chinese companies still tag it made in china.

diamond68:
Is it really by your productivity or by the size of your nuclear weapons ? What is Britain producing to have such a strong currency? What are they exporting ?

Football, Cricket etc, Universities, plus tons of Fortune 500 companies.

WrriterNg:


Name them please.

You mean it produces nothing, yet thousands of Nigerians immigrate there each year? To do "nothing"?

diamond68:
Is it really by your productivity or by the size of your nuclear weapons ? What is Britain producing to have such a strong currency? What are they exporting ?

This question of yours reminds me of the comedian Alibaba once saying that people do ask him how he makes money. Of course, that's before people knew that comedians make money by talking.

See, through many years of enslaving and colonizing people, they've already structured how to generate wealth from other countries with or without doing anything else.

For example; we are literally working for them on Nairaland just by speaking their language.

Then, you'll ask how? like they asked Alibaba.

This site is not hosted on a Russian or Chinese or Japanese server. The content is also in their language. Right? Because the owner doesn't speak Russian, Chinese or Japanese. Neither do we.

How about the content we s create? Are they read by Russians, Chinese or Japanese?

I don't want to talk about other aspects. I just wanted to show that they've already structured how to create wealth from others. There's little you do that's not to their benefit when it's all cleaned and dusted

jedisco:


Exchange rate means little. It can be set arbitrarily like many countries have done. Some have even rebased their currency but without the right fundamentals, the slide would only continue.

What matters is stability not the nominal exchange.
Its stability that determines the strength of a currency and investor confidence

You're 100% correct. The exchange rate is meaningless. What's important is the stability of the currency.

Currencies derived their values from precious metals such as gold and silver. However, in the 70s, Nixon removed the dollar from the gold standard and made it free-floating. Free-floating implies that its value is derived from the demand and supply of US dollars. In reality, countries try to keep their currencies stable in many ways, such as reducing government spending, raising taxes, raising interest rates to attract international bond traders, increasing investments in public education and healthcare to make your citizens more productive, and investments in security and tourism, etc.

Dtribeless:


Inside the phone is a lot of British IP -- the chip technology for example. Una no sabi but expect Nigeria to grow with this lot -- clueless like Buhari.

China is just a manufacturing ground and many of the investors are westerners , so the Chinese take rent and other dues , the westerners have already started shifting production to Indian .

Bede2u:
lol you try and Kuwaiti Dinah?

Very positive balance of payment. I try again?

Bede2u:
i take it you have researched it? Can you then tell us why the British pounds has more value than U.S dollars? Or why Kuwait's Dinah is stronger than British pounds? Just explain, no insults

British pound -- better fiscal and monetary management than US dollar, meaning fewer pounds vs assets. Kuwait Dinah -- very positive balance of payment. Apologies for the initial slight.

This might help.

Table of Contents
Guide to Forex Trading Strategy & Education
Why the British Pound Is Stronger Than the U.S. Dollar
By Brian Dolan Updated October 27, 2024
Reviewed by Samantha Silberstein
Fact checked by Vikki Velasquez
Pound Coins and Bank Notes


TEK IMAGE / SCIENCE PHOTO LIBRARY / Getty Images

Historically, the British pound (GBP) has been stronger than most currencies, including the U.S. dollar. In 2007, the value of the GBP hit a record doubling the value of the U.S. dollar.
1
As of 2024, the British pound is the fourth strongest currency in the world, maintaining a steady value of over 1.20 USD including an exchange rate of 1.30 as of October 2024.
2
3

The value of the British pound is explained by a combination of factors, like interest rates, inflation, and the overall state of the economy. The strength of the GDP is driven mainly by the fact that the Bank of England, which issues the currency, has played an active role in international economic developments. However, in recent years especially since Brexit, the GBP has weakened due to higher interest rates and fear of a recession, while the U.S. dollar has strengthened.

Key Takeaways
For more than 20 years, the British pound has been stronger than the U.S. dollar in nominal .
Brexit weakened the British pound on a structural level.
Lack of market confidence in both the government of then-U.K. Prime Minister Liz Truss and Trussonomics further weakened the pound.
The jettisoning of the Truss tax cuts by Jeremy Hunt, the current Chancellor of the Exchequer, seems to have stabilized markets and consequentially halted the decline of the pound.
4
5
A Brief History of the U.K. Pound (GBP) vs. the U.S. Dollar (USD)
Before World War II, and arguably before World War I, the British pound (GBP) was the primary medium of foreign exchange, giving it a nominal over other currencies including the U.S. dollar (USD), with a pound (£1) fetching $5 and more. After WWII, however, the USD began its rise to become the preeminent currency in international trade and a global store of value.
6

For example, as of the end of 2022, the USD comprised 58% of global foreign exchange holdings.
7
Starting from those lofty valuations, the USD began to supplant the GBP, leading to a long slide in the GBP/USD rate over the succeeding decades.

The British pound (aka the sterling) has been nominally stronger than the USD for most of the past few decades, making a high of just over 2.00 USD per GBP around the time of the Great Financial Crisis (GFC) of 2007–2009. The GFC saw investors flee to the USD and out of the pound, among other major currencies. Once the GFC dust had settled, the GBP dropped to the 1.40–1.45 level.
6
The GBP weakness was more a case of panic buying of the USD than any GBP-negative issue, as other major currencies weakened sharply against the USD as well (see long-term chart below).

GBP history
In subsequent years, GBP/USD fluctuated between roughly 1.40 and 1.70, but then came Brexit in June 2016, when the United Kingdom surprisingly voted to leave the European Union (EU). The pound was knocked down virtually overnight from the 1.40–1.45 area to the 30-year low of 1.32, where it remained until recent events and market dislocations.
8
9

The culprit this time is a combination of factors, chief among them USD strength due to widening interest rate differentials in the USD’s favor. Along with higher relative interest rates, the U.S. economic outlook is reasonably positive, while market watchers are soon to declare the U.K. is in or near recession. The pound is not alone in being sold against the USD, as investors fear a global recession and favor the greenback as a safe haven in times of economic distress.

Nominal Value vs. Relative Value
The nominal value of a currency is relatively arbitrary. What matters is how the value of that currency changes over time relative to other currencies. For more than 20 years, one U.S. dollar has been worth less than one British pound.

As of October 2024, the dollar was sitting at around 1.30 to one pound.
10
This is down from 1.68 in May 2014 and 1.40 in March 2018.
11
12
This trend is indicative of deteriorating economic conditions in the United Kingdom, mainly from Brexit, combined with an improving U.S. economy.

In September 2022, the GBP fell to about $1.03 USD, marking the lowest price for the pound against the U.S. dollar in over 30 years.
13


It’s also worth considering that many more dollars are in circulation than pounds. As of April 2024, $2.348 trillion U.S. dollars were in circulation.
14
By contrast, the total pounds in circulation come to a mere £ 81 billion.
15
To draw an analogy, the 2020 market capitalization of Berkshire Hathaway Inc. (BRK.A, BRK.B) was much lower than that of Microsoft Corp. (MSFT) despite the fact that Berkshire Hathaway’s share price is much higher.
16
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This is because there are many more outstanding Microsoft shares than Berkshire Hathaway shares.
19
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21

Consequences of Brexit
On June 23, 2016, British citizens went to the polls and voted in favor of a referendum to leave the EU, of which the country had been a member since 1973.
22
The Brexit, or British exit, came about as a result of a populist movement that had grown weary of ceding control of laws and regulations to outside forces in Brussels. There was also a fear of the effects of what was viewed as unchecked immigration. Economists, most of whom were confident that Britain would vote to remain in the EU, warned of economic consequences that would result from Brexit.

The vote in favor of Brexit shocked oddsmakers and roiled world markets. It also had an immediate and pronounced effect on the British pound, which declined in value by more than 8% in the 24 hours following the vote.
23
This is another example of relative value trumping nominal value. While the pound remained stronger than the dollar in nominal , investors still abandoned the currency, citing its precipitous decline in relative value.

The pound has been turbulent and volatile since the 2016 Brexit announcement. Near the end of 2016, the GBP/USD reached lows of around 1.20. There was a slight rebound in 2018, peaking at around 1.40 in April of that year.
9
Most recently, the sterling was trading roughly 1.2588 against the buck, owing to concerns over global growth, the risks of a U.K. recession, and interest rate differentials vastly in favor of the USD.
3
Market speculators may very well make a test of parity (1 GBP to 1 USD) and even lower, potentially giving the USD a nominal value above the GBP.

Why Has the British Pound (GBP) Maintained a Nominal to the U.S. Dollar (USD) for All These Years?
Much of it has to do with the starting point of GBP/USD more than a century ago. The sterling has been in a long downward slide against the greenback for many decades, owing to the USD’s rise to prominence, the growth of its economy, and GBP negatives, such as Brexit and a widening interest rate gap against the sterling, to name a few current factors. The nominal is not carved in stone, and speculative and macroeconomic developments may soon see the pound give up its nominal .

Does It Matter If GBP/USD Falls Below Parity?
It would certainly be a blow to the United Kingdom’s ego, but it won’t make a significant change to global currency valuations. A weaker pound is a double-edged sword for the U.K.: A weaker currency is good for exports, which can bolster the economy, but a weak currency is also a driver of inflation (imports are more expensive), which the Bank of England (BoE) is legally obliged to contain. The risk is that a downward move in GBP/USD could become disorderly, for which the U.K. would need outside help (think the Group of Seven [G-7]) to contain or slow the decline.

Which Is More Important to the GBP: Nominal Value or Relative Value?
A weak pound is a nominal construct as far as exchange rates go. However, if the sterling is seen to be diverging from other currencies as well—i.e., its relative value is falling across the board—it could provoke a run on the GBP, with speculative sellers as the driving force behind that selling.

The Bottom Line
The British pound (GBP) has enjoyed a nominal to the U.S. dollar (USD) for many years, owing both to historical convention and the Bank of England’s willingness to intervene in times of crisis to defend the pound. The resignation of Kwasi Kwarteng as Chancellor of the Exchequer and the subsequent collapse of the Liz Truss government seem to be acting as a stabilizing influence on the GBP.
4
5
The sterling now appears to be holding steady, with the exchange rate at $1.30 USD to £1 GBP as of October 2024.
3

Premier league

diamond68:
What is Britain producing to have such a strong currency? What are they exporting ?

Let me educate you small... well, a lot!!!
Great Britain (commonly shortened to Britain) consists of the countries England, Scotland and Wales. That's THREE (3) COUNTRIES.

ENGLAND
England's economy is one of the largest and most dynamic in the world, with an average GDP per capita of £37,852 in 2022. England is a leader in the chemical and pharmaceutical sectors and in key technical industries, particularly aerospace, the arms industry, and the software industry.
Agriculture is intensive, highly mechanised and efficient by European standards, producing 60% of food needs with only 2% of the labour force. Two-thirds of production is devoted to livestock, the remainder to arable crops. The main crops that are grown are wheat, barley, oats, potatoes, and sugar beets. England retains a significant fishing industry. Its fleets bring home a variety of fish, ranging from sole to herring. England is also rich in natural resources including coal, petroleum, natural gas, tin, limestone, iron ore, salt, clay, chalk, gypsum, lead, and silica.

SCOTLAND
GDP per capita £39,707 (Even more than popular England
The Scottish economy was dominated by heavy industry like shipbuilding, coal mining and steel industries. Petroleum-related industries associated with the extraction of North Sea oil have also been important employers since the 1970s.
In 2021, Scottish exports in goods and services (excluding intra-UK trade) were estimated to be £50.1 billion. Scotland's primary goods exports are mineral fuels, machinery and transport, and beverages and tobacco.
Whisky is one of Scotland's more known goods of economic activity.

If you add these 2 countries alone together, you can see they developed their extractive industry (which we failed to do with ours); built a service industry and also leverage on technology and manufacturing for their industrial economy.
Those are the things backing the GBP

WrriterNg:


When was the last time you saw a Made in Britain or Made in USA product?

Anyone??

But i bet the phone you use now was made in China. Even if it's an iPhone.

You read where he enumerated the things in which UK produces but took them off to reply only a sectional thought.


1. Aeroplane parts
2. Turbines
3. Cars.
4. Pharmaceuticals
4. Gins
6. Port
7. Breakfast cereals of different types
8. Pork
9. Computers
10. Nuclear reactors
11. Wines
12. Surgical instruments
13. Industrial and laboratory chemicals
14. Iron and steel
The list is endless

The next time you buy Royce rolls check where it's manufactured because the last one you bought you didn't check where it was made

Dtribeless:


British pound -- better fiscal and monetary management than US dollar, meaning fewer pounds vs assets. Kuwait Dinah -- very positive balance of payment. Apologies for the initial slight.

This is vague. Can you detail further how Britain that is broke and had been bailed by IMF in the 1970s has better monetary management than U.S. The UK leadership themselves have itted that the UK's economy is broken currently.

And if balance of payment leads to strong currency, does Kuwait have the strongest balance of payment in the world to have the strongest currency?

diamond68:
Is it really by your productivity or by the size of your nuclear weapons ? What is Britain producing to have such a strong currency? What are they exporting ?

Britain exports services. Something Nigeria should be doing too but we are mad.

Bede2u:

For instance, Ecowas has been trying to initiate a single currency for the sub region forever with no success because they say countries must achieve certain inflation, monetary and fiscal targets to qualify. My question is, when the UK imposed their pounds on bush African communities in 1890, did those bush communities meet those inflation targets?

Ecowas doesn't need to meet any targets whatsoever to have a unified currency.
If all the agree today, we can have the ECO currency tomorrow.
This is a basic knowledge for any informed person, let alone an economist.

As bad as naira is currently valued, it is still way higher than Indonesian rupee despite Indonesia being a larger and more stable economy.
China produces more than many countries but still has a lowly valued currency.
Currency is a political tool rather than an economical one.

Here is pre-economics 101.
You see a person earning 1 million Naira per month has the option to spend 50K per month or 500K per month,
but a person earning 30K per month have no option to upgrade above 30K without significant and crushing borrowing.
That is the case with strong vs weak economics and who has the capacity to devalue or revalue at will.

Our naira was stronger than the dollar in 1980, then IMF suggested we start devaluing it because it's value was inflated. Question, why didn't imf suggest to the British to devalue the nigerian pound when the British were incharge, considering that our economy in 1980 was way larger than our economy under British rule.
Politics

Our Naira can be stronger than the dollar today should the government be ready to do it.

quote]
I see a few people quoting me to tell me China deliberately devalues its currency. Well that is exactly the point of my post. That currency valuation is more politics than economics. Do you get it now?[/quote]
No.
It is you who don't get it.
Currency valuation is 100% economics, the fact that a country does opposite of what another did
based on economic power or lack thereof doesn't imply politics.
There is no omnipotent god of economics that dictates how a nations currency should be valued, don't confuse
IMF advise for order. IMF is a bank and it always advise, countries, which are mostly ignored unless for those
in financial problems and desperately need to borrow.
Moreover, economics is not a real science, a country can run it however it likes as long as it is satisfied with the results.

Suppose you reduce the price of your goods in order to sell more than your competitors, are you playing politics
or are you making an economic decision?

By your logic, a person who buys a Tecno because they can't afford iPhone is playing politics.
While a person who can afford iPhone but chooses Google Pixel must be playing politics too.

The only way your submission makes sense is if the meaning of the word "politics" has changed.

Xisnin:

Ecowas doesn't need to meet any targets whatsoever to have a unified currency.
If all the agree today, we can have the ECO currency tomorrow.
This is a basic knowledge for any informed person, let alone an economist.


Here is pre-economics 101.
You see a person earning 1 million Naira per month has the option to spend 50K per month or 500K per month,
but a person earning 30K per month have no option to upgrade above 30K without significant and crushing borrowing.
That is the case with strong vs weak economics and who has the capacity to devalue or revalue at will.


Our Naira can be stronger than the dollar today should the government be ready to do it.

quote]
I see a few people quoting me to tell me China deliberately devalues its currency. Well that is exactly the point of my post. That currency valuation is more politics than economics. Do you get it now?
No.
It is you who don't get it.
Currency valuation is 100% economics, the fact that a country does opposite of what another did
based on economic power or lack thereof doesn't imply politics.
There is no omnipotent god of economics that dictates how a nations currency should be valued, don't confuse
IMF advise for order. IMF is a bank and it always advise, countries, which are mostly ignored unless for those
in financial problems and desperately need to borrow.
Moreover, economics is not a real science, a country can run it however it likes as long as it is satisfied with the results.

Suppose you reduce the price of your goods in order to sell more than your competitors, are you playing politics
or are you making an economic decision?

By your logic, a person who buys a Tecno because they can't afford iPhone is playing politics.
While a person who can afford iPhone but chooses Google Pixel must be playing politics too.

The only way your submission makes sense is if the meaning of the word "politics" has changed.

lol how do I start replying to this post that is already full of contradictions. I will only point you to what Ecowas said about the Eco which you obviously didn't know about.

For the Eco to be implemented, ten convergence criteria, set out by the West African Monetary Institute (WAMI), must be met. These criteria are divided into four primary and six secondary criteria. Up to the fiscal year 2011, only Ghana has been able to meet all the primary criteria in any single fiscal year.

The four primary criteria to be achieved by each member country are:

A single-digit inflation rate at the end of each year.
A fiscal deficit of no more than 4% of the GDP.
A central bank deficit-financing of no more than 10% of the previous year's tax revenues.
Gross external reserves that can give import cover for a minimum of three months.
The six secondary criteria to be achieved by each member country are:

Prohibition of new domestic default payments and liquidation of existing ones.
Tax revenue should be equal to or greater than 20 percent of the GDP.
Wage bill to tax revenue equal to or less than 35 percent.
Public investment to tax revenue equal to or greater than 20 percent.
A stable real exchange rate.
A positive real interest rate.

fkj950ax:

Let me educate you small... well, a lot!!!
Great Britain (commonly shortened to Britain) consists of the countries England, Scotland and Wales. That's THREE (3) COUNTRIES.

ENGLAND
England's economy is one of the largest and most dynamic in the world, with an average GDP per capita of £37,852 in 2022. England is a leader in the chemical and pharmaceutical sectors and in key technical industries, particularly aerospace, the arms industry, and the software industry.
Agriculture is intensive, highly mechanised and efficient by European standards, producing 60% of food needs with only 2% of the labour force. Two-thirds of production is devoted to livestock, the remainder to arable crops. The main crops that are grown are wheat, barley, oats, potatoes, and sugar beets. England retains a significant fishing industry. Its fleets bring home a variety of fish, ranging from sole to herring. England is also rich in natural resources including coal, petroleum, natural gas, tin, limestone, iron ore, salt, clay, chalk, gypsum, lead, and silica.

SCOTLAND
GDP per capita £39,707 (Even more than popular England
The Scottish economy was dominated by heavy industry like shipbuilding, coal mining and steel industries. Petroleum-related industries associated with the extraction of North Sea oil have also been important employers since the 1970s.
In 2021, Scottish exports in goods and services (excluding intra-UK trade) were estimated to be £50.1 billion. Scotland's primary goods exports are mineral fuels, machinery and transport, and beverages and tobacco.
Whisky is one of Scotland's more known goods of economic activity.

If you add these 2 countries alone together, you can see they developed their extractive industry (which we failed to do with ours); built a service industry and also leverage on technology and manufacturing for their industrial economy.
Those are the things backing the GBP

ok you going in dawg 👀😳

tobolos:
If we claim the UK doesn’t produce much, then the question arises: where are all the immigrants working, especially in a country with a single-digit unemployment rate?

I believe the primary issue with many manufacturing-heavy nations like China and India is their large populations. The wealth per capita in these countries poses a significant challenge. This often results in employers exploiting workers with low wages and inadequate welfare systems.

In essence, I firmly believe that a nation’s growth is closely tied to the quality of life of its citizens. Ironically, Nigerians seemed to thrive during the period we lived what some called the "fake life," which made international financial institutions like the IMF envious.

Where else can you find individuals building houses, electrifying their communities, sinking boreholes, providing security, grading roads, and still managing to care for their families? That so-called "fake life" empowered us greatly until the IMF interfered out of envy. Now, they’re satisfied seeing us selling our properties to flee from our beloved country.

these are strong allegations against the IMF but am here for it 🥴😄. So you think this was driven by envy ? Care to expand ?

Flangelo12:
English Premier League that you watch is not a product?

lol I guess it is 🥴

Bede2u:
This is vague. Can you detail further how Britain that is broke and had been bailed by IMF in the 1970s has better monetary management than U.S. The UK leadership themselves have itted that the UK's economy is broken currently.

And if balance of payment leads to strong currency, does Kuwait have the strongest balance of payment in the world to have the strongest currency?

if you can type up all you do you can research. Put this in google — I’m not obliged to educate you.

Dtribeless:
if you can type up all you do you can research. Put this in google — I’m not obliged to educate you.

Then you shouldn't be on this thread, sorry.

Bede2u:
Then you shouldn't be on this thread, sorry.

It is you who shouldn’t be here: asking officious questions you can research yourself, contributing nothing!

Bede2u:
This is vague. Can you detail further how Britain that is broke and had been bailed by IMF in the 1970s has better monetary management than U.S. The UK leadership themselves have itted that the UK's economy is broken currently.

And if balance of payment leads to strong currency, does Kuwait have the strongest balance of payment in the world to have the strongest currency?

You really want me to respond to 1970s Britain in 2024? Check what inflation is vs Nigeria and maybe you’d know Dangote broke is not your broke.