Concerning the stability of the Commonwealth pound

ATHENS, June 1, 2022 - See below briefing concerning the statement by the Commonwealth Exchequer on the stability of the Commonwealth pound.

The Commonwealth pound currency has a free-floating exchange rate regime, whereas the value of the Commonwealth pound is influenced by a combination of market dynamics and certain assets held by the British Commonwealth that guarantee a minimum value of the currency.

The Commonwealth foreign exchange reserves of 210.18 bn. GBP + the asset book value of trade funds equal to 235m GBP + the pledged Greek Crown assets of 89 bn. GBP (which is less than 10% of the Greek Crown assets) = 299.42 bn. GBP of assets that provide minimal guaranteed value to the Commonwealth pound.

190.86 bn. BCP is currently in circulation - of which 119.8 bn. BCP is the Commonwealth budget and 71.06 bn. BCP belongs to citizens, businesses, governments and various organisations.

On June 1st, 299.42 / 190.86 = 1.57 GBP is the minimum guaranteed value of 1 BCP. Even if the entire foreign exchange market collapsed completely (which is impossible), then on June 1st, the Commonwealth pound would lose no more than about 17% of its value - the rest is legally guaranteed. For comparison, over the past year, in relation to the pound sterling, the ruble lost up to 79% of its value, the US dollar up to 15% of its value, and the Commonwealth pound only up to 4% of its value.

On June 1st 1 BCP was sold for 1.91 GBP, whereas the first currency transaction was made at the rate of 1.9 GBP. It is expected that the BCP/GBP rate will go between 1.88 and 1.95 for the next 6 months, a variation in the region of 2-3% which is more stable than the Euro and more stable than the Swiss franc.