What may be good for Irish tourists, though, is bad for anyone doing business in either country. Analysts watching the currency markets have predicted that the euro will continue to strengthen against the two currencies and could hit $1.20 by the end of the year.
Other analysts have been much more cautious but still predict a year-end rate of $1.13, making exports from Ireland considerably more expensive.
The result is likely to have a negative effect on the Irish economy, but that is not the full picture, as experts also say the strengthening euro could put a lid on Ireland’s worryingly high level of inflation.
Robbie Kelleher of Davy Stockbrokers in Dublin has said that it’s the euro rise against sterling that will have the most serious effect on Irish business.
The UK is still Ireland’s most important trading partner and it would have made more sense, Kelleher opined last week, if Ireland had waited to join the euro zone whenever the UK did.
Kelleher warned that the euro could go as high as $1.30 in 2004 and that the problem could become chronic.
An example of the effect on foreign businesses in Ireland happened in March when Florida-based Artesyn Technologies, a telecommunications manufacturer with its European headquarters in Youghal, Co. Cork, and with factory bases in Austria, moved its operations to the Hungarian mining town of Tatab