Ireland's rating declines slightly

THE J P Morgan calculator shows reasonable stability in market expectations about the move to monetary union

THE J P Morgan calculator shows reasonable stability in market expectations about the move to monetary union. Ireland's rating declined slightly, according to the calculator, although the unusual currency moves of the last few days - and the resulting impact on the interest rate markets may have affected the Irish figures.

The J P Morgan calculator, published each week in The Irish Times, is designed to measure investors' expectations about monetary union. It is based on rates in the interest rates swaps market.

Irish interest rate markets have been affected by the currency moves of recent days, as speculators have been borrowing Irish pounds with the intention of selling the currency to make a profit. This contributed to some fall-off in Ireland's rating in the J P Morgan calculator, which now stands at 57 per cent.

However, a clearer reading from the markets may not be available until the currency turbulence eases down and wholesale interest rate markets settle down. The calculator shows some easing in the ratings of most states, with Sweden, Portugal, Finland, Italy and Spain all seeing some reduction in their figure.