Icelandic Crown Strengthening - The Reykjavik Grapevine

Icelandic Crown Strengthening

Published June 2, 2010

The Icelandic crown has recently taken a strengthening position in the world currency markets, and is showing its best performance against the British pound and the euro in over a year.
The crown is now at 157.5 ISK for each euro, an increase of 14% since the beginning of this year alone. The crown verses the pound has also changed since the beginning of the year from 202:1 to 188:1 today.
Íslandsbanki attributes the strengthening position of the crown to increased cash flow coming into Iceland as exports have increased.
The news comes on the heels of reports that unemployment in Iceland is dropping, which is in itself another reason of economic recovery.
Iceland’s unemployment has been steadily decreasing, however slowly. Moody’s also raised Iceland’s rating to Stable recently, and a report from the IMF contends that the country will have a fully balanced budget by 2014.
However, many Icelandic families still face high food costs and loans that are running away from them. This has prompted labor unions to accuse the government of not doing enough to help the average Icelandic household.

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