The British government said today it would not artificially massage sterling's exchange rate, nor would it rejoin the European exchange rate mechanism should it decide to press for euro membership.
'I don't think...the government should try artificially to massage down the level of the exchange rate,' Treasury minister Ruth Kelly said in a parliamentary debate.
But she said the level at which sterling would enter the single currency zone would have to be consistent 'with economic fundamentals... and compatible with sustainable convergence between the UK and other euro area economies'.
The Independent newspaper had quoted unnamed officials in Brussels as saying that Britain would have to rejoin the ERM before joining the euro.
'The government has no intention of rejoining any exchange rate mechanism,' Kelly said.
