A North-East daily managed to move the money markets when it published an exclusive interview with the Governor of the Bank of England.

Andrew Hebden, head of business at The Journal, Newcastle, spoke to Mervyn King during a recent visit to the region.

Mr King was asked about The Journal’s ‘Go Global’ campaign in conjunction with the North East Chamber of Commerce which is designed to encourage exporters in the region.

His response – that exporters had been helped by the weak pound – was held by analysts to have prompted sterling to fall to its weakest level against the euro for more than five months.

Mr King’s remark was taken as an indicator that he believed there were benefits for business and the wider economy from the decline of the currency.

The pound fell more than 1pc on the day against the dollar after Mr King’s comments were reported around the world last week.

Analysts said the market considered his remarks as a good opportunity to wipe out a rise in sterling that had occurred the previous day.

“When the market’s down on a currency, it will jump on anything that justifies selling it,” said Stuart Bennett, currency strategist at Calyon in London.

It is not the first time The Journal’s coverage of comments by Bank of England governors has led to wider repercussions.

In 1998, Mr King’s predecessor, Eddie George, sparked a furore when he told the paper’s political editor that lost North-East jobs were an “acceptable” price to pay for keeping the lid on inflation.

Comments

John Rogers (01/10/2009 13:19:58)
So now the rest of the country is paying the price so that our very small number of exporters can make hay. My heartfelt thanks to Mr King for helping get me roughly one-for-one, pound to euro, on business in Italy and France last week. Is he Gordon in disguise?