Skip to main content Accessibility help
×
Home
Hostname: page-component-59b7f5684b-vcb8f Total loading time: 0.475 Render date: 2022-09-27T06:02:18.595Z Has data issue: true Feature Flags: { "shouldUseShareProductTool": true, "shouldUseHypothesis": true, "isUnsiloEnabled": true, "useRatesEcommerce": false, "displayNetworkTab": true, "displayNetworkMapGraph": false, "useSa": true } hasContentIssue true

2 - Foreign Fetters

Published online by Cambridge University Press:  18 September 2020

Harold James
Affiliation:
Princeton University, New Jersey
Get access

Summary

In 1976 UK economic policy making and fiscal strategy was transformed as a result of an exchange rate crisis that brought in the International Monetary Fund. Monetary targeting began to be a theme of policy debate. A central part of the pre-1979 influence and effective power of the Bank of England rested on the fact that the British domestic financial market was self-contained or cut off from the rest of the world, through the use of capital and exchange controls, applied to UK residents (corporations and individuals) but not to international holders of sterling. In 1976, as part of the IMF rescue package, exchange controls had been tightened, with a prohibition of use of sterling in trade financing that did not involve the UK. The incoming Conservative government started with a partial decontrol in July 1979, when restrictions on direct overseas investments were removed, and portfolio investment also became easier. In October 1979 exchange controls were completely abolished, a move which challenged the Bank of England’s control of the money supply.

Type
Chapter
Information
Making a Modern Central Bank
The Bank of England 1979–2003
, pp. 32 - 42
Publisher: Cambridge University Press
Print publication year: 2020

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

Save book to Kindle

To save this book to your Kindle, first ensure coreplatform@cambridge.org is added to your Approved Personal Document E-mail List under your Personal Document Settings on the Manage Your Content and Devices page of your Amazon account. Then enter the ‘name’ part of your Kindle email address below. Find out more about saving to your Kindle.

Note you can select to save to either the @free.kindle.com or @kindle.com variations. ‘@free.kindle.com’ emails are free but can only be saved to your device when it is connected to wi-fi. ‘@kindle.com’ emails can be delivered even when you are not connected to wi-fi, but note that service fees apply.

Find out more about the Kindle Personal Document Service.

  • Foreign Fetters
  • Harold James, Princeton University, New Jersey
  • Book: Making a Modern Central Bank
  • Online publication: 18 September 2020
  • Chapter DOI: https://doi.org/10.1017/9781108875189.002
Available formats
×

Save book to Dropbox

To save content items to your account, please confirm that you agree to abide by our usage policies. If this is the first time you use this feature, you will be asked to authorise Cambridge Core to connect with your account. Find out more about saving content to Dropbox.

  • Foreign Fetters
  • Harold James, Princeton University, New Jersey
  • Book: Making a Modern Central Bank
  • Online publication: 18 September 2020
  • Chapter DOI: https://doi.org/10.1017/9781108875189.002
Available formats
×

Save book to Google Drive

To save content items to your account, please confirm that you agree to abide by our usage policies. If this is the first time you use this feature, you will be asked to authorise Cambridge Core to connect with your account. Find out more about saving content to Google Drive.

  • Foreign Fetters
  • Harold James, Princeton University, New Jersey
  • Book: Making a Modern Central Bank
  • Online publication: 18 September 2020
  • Chapter DOI: https://doi.org/10.1017/9781108875189.002
Available formats
×