Without wishing this to be a self-fulfilling prophecy, I'm just wondering how people feel about a possible further devaluation of our currency? It is already at its lowest level against the Euro for 4 years and thankfully for the time being has bottomed out at €1.40/£

It appears that the banks want the BoE to lower interest rates and introduce more 'liquidity' so that they can cover their own loans, and reflate the credit bubble (thus avoiding a property crash). This in itself will lower the value of the pound and add to inflationary pressures in sectors other than housing where a low pound will help to keep prices in pounds high. A more formal devaluation of sterling would of course be welcomed by mortgagees as the value of their debts would diminish accordingly (rather like the last time Labour was in power during the 1970s). However it would also diminish the value of savings.

To put it bluntly if sterling is devalued, your money will be worth less so far as buying food and paying energy bills is concerned, leaving you with a lower disposable income, but house prices (quoted in sterling) will not fall.

Whoops, I just realised that I spelled 'devaluation' wrong!

Been thinking about ths myself and thinking of hedging against GBP falls as I don't want my savings disappearing down a hole.

Anybody any advice on the easiest way of hedging against GBP devaluation using forex? And no i'm not a gold fanatic.

When I posted this nearly two months ago, I thought that Sterling had bottomed out at about €1.40. Of course the BoE cut rates the following week, which led to a run on Sterling and it now resides at about €1.34 (or €1.35 on a good day).

This appears to be a deliberate ploy, ie devalue the currency, let inflation wipe out all the debt and give house prices a 'soft landing'. It is plausible that Sterling will fall further, to possibly even below €1.25, by the end of this year.

All the while inflation, which is already way higher than the RPI of 4%, never mind the CPI of 2.1%, will continue rising, but the BoE will manipulate the figures to exclude what they don't want to and the media will follow the spin. Notice how when the quote 'inflation' they always use CPI, not RPI, now?

Most of the media, especially the BBC, will not highlight the link between low interest rates and high inflation, preferring to obfuscate and suggest that Sterling's weakness and high inflation are somehow linked to the poor state of 'the economy', as reflected in falling house prices, ie stop house prices falling and everything else will be hunky dory.