A presentation by IIB bank today outlined some of the key factors likely to influence currency markets in 2006, and what these might imply for the profitability of Irish firms selling abroad.
The briefing maintained that the US dollar and sterling could slide in 2006, and so Irish exporters could face more challenging market conditions next year.
IIB said softer US economic growth, less supportive currency flows and Alan Greenspan's replacement by Ben Bernanke meant downside risks to the dollar.
The bank warned that weaker high street spending and a 'rebalancing' of the UK economy posed significant problems for sterling, and that a solid dollar and sterling through 2005 was only a temporary respite and might make Irish exporters complacent.
The bank said a stronger euro should limit any increase in interest rates here and also implied that businesses catering to the Irish consumer would again do better than those selling abroad.
