| Publication |
2013.
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| Summary/Abstract |
Following the November 1967 sterling devaluation, the British Labour government of Harold Wilson struggled to defend the new exchange rate of £1?=?$2.40. Sterling's travails continued throughout 1968 and well into 1969 despite growing evidence that the external balance was moving into the black. Its problems arose from external difficulties, notably from the growth of footloose balances of foreign currencies-especially Eurodollars-within the international economy and from instability caused by the decline of the Bretton Woods system. Labour was determined to protect the new exchange rate, since a new devaluation or even a float would have led to a run on the pound, the collapse of its economic strategy, and the failure of its attempt to build a social-democratic order in Britain. It was successful in the end thanks to growing confidence in its policies and to belated international co-operation designed to salvage the Bretton Wood regime.
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