IEP (Irish Pound)

What Was the IEP (Irish Pound)?

The IEP (Irish Pound) was the foreign exchange (FX) currency symbol for the Irish pound, the national currency of Ireland until 2002. The Irish pound was made out of 100 pennies, called pingin in Irish, and frequently appeared with the symbol \u00a3 or IR\u00a3 to set it apart from different currencies, for example, the British pound. The Irish term for the Irish pound is the punt \u00c9ireannach.

Figuring out the Irish Pound

Irish currency traces all the way back to the principal thousand years C.E., trailed by the Act of Union in 1800, which joined Ireland and Great Britain into one realm. This first Irish pound was consequently absorbed into the British Pound.

After the Irish Free State was framed in 1922, trade with the U.K. kept on overwhelming the Irish economy. The government in this way didn't see the need to focus on the creation of another currency. It was only after 1927 that the Irish government started giving its own Irish pound, pegging it to British sterling at parity. The government likewise guaranteed full convertibility to the Great British Pound (GBP) sterling.

For a really long time, the Irish government managed its currency through a currency board. In 1942, the council passed a law to lay out the Central Bank of Ireland, yet subsequent to making this new monetary authority, Ireland retained its 1:1 peg IEP to the pound sterling. This practice proceeded with even after Ireland departed from the Commonwealth and declared itself an independent Republic in 1948. At the point when the pound sterling was devalued due to the Bretton Woods system in 1949, and again in 1967, Ireland actually didn't change its currency's pegging.

The 1970s were a decade of monetary reform in Ireland. First was the national decimalization of the Irish pound and afterward came the Central Bank Act of 1971. This Act assigned new powers to the monetary authority and eventually prompted Ireland's participation in the European Exchange Rate Mechanism (ERM) in 1978. In 1979, the proper connection with the British Pound was, finally, broken and the currency was floated on the free market.

The Euro Replaces the Irish Pound

The plan to make a single, container European currency started to gather support in 1986, with the signing of the Single European Act. This set the stage for a free economic market without trade barriers in Europe. A sensible supplement to this borderless market would be a single, binding together currency.

Ireland was one of the earliest countries to embrace the euro on the first of January 1999, fixing the value of the Irish pound to the euro at the rate of 0.787564 Irish pounds. For quite some time, the euro existed exclusively as a virtual currency for the purpose of bookkeeping, called a numeraire. It was only after January 2002 that circulation of euro banknotes and coins in Ireland started alongside the remainder of the EU countries at that point.

In the early years following the joining of the euro, there were stresses of nearby inflation. There are accounts of business owners showing two parallel prices (i.e., in both IEP and EUR) on their goods available to be purchased. This was an endeavor to check whether prices in the new currency had ascended with inflation.

As per World Bank data, Ireland encountered a 0.94% annual inflation rate and had gross domestic product (GDP) growth of a 5.5% starting around 2019, which is the latest year of accessible data.

Features

• The Irish Pound (IEP) was the national currency of Ireland, which was supplanted by the euro in 2002 as part of the EU common monetary union, fixing the value of 1 euro at the rate of 0.787564 Irish pounds.
• The Irish pound itself traces all the way back to the principal thousand years C.E. at the point when Ireland unified with England.
• From 1922 until 1979, Ireland kept a tight peg of 1 IEP to 1 GBP, at which point it turned into a freely floating currency until its switch over to the EUR.