4 OCTOBER 1997, Page 28


The ground shifts, now it's wait and see and, barring accidents, join


TONY BLAIR can make the faithful believe most things. No change, he told his party conference, about the single currency for Europe: when the time came his gov- ernment would make a hard choice, in the national interest. For a moment he sound- ed just like John Major, but even the most credulous must realise that this week the ground has shifted. He and his government have moved from a policy of wait and see to an attitude of wait and, barring acci- dents, join. Indeed, we have been here before. We would pledge our currency to Europe, so I forecast, in the week after the International Monetary Fund's meeting, in the week before the Conservatives' confer- ence and in the middle of Labour's. So it proved. Margaret Thatcher popped out from 10 Downing Street like a cuckoo from a clock to proclaim that the pound had joined the European exchange rate mecha- nism. She had timed it to upstage Neil Kin- nock and John Smith. The markets were delighted, and enjoyed their best day until the day when we came out again, just over two years later. Those who guessed right made fortunes and found themselves under suspicion of insider trading. (What non- sense — they need only have subscribed to The Spectator.) This time round the City had picked up a story that the pound might, after all, be made a founder member of the single currency. That was and is hard to take at its face value, but the markets sensed a change of mood, some well-placed drips from the Treasury's water-gardeners encouraged them, and Friday of last week was their best day ever. Those who guessed right were rewarded and those who missed out are pointing querulous fingers. Here we go again.