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Glasgow Herald: Stay away from the euro, says Minford
IT would be "strongly against" Britain's economic interests to join the euro, The Institute of Economic Affairs warned today.
Professor Patrick Minford said the country's interests dictated it should stay out of the single currency, and any gains from the move would be more than outweighed by the losses.
In a paper published by the institute he warns that joining the euro, and therefore losing control of setting interest rates, could also lead to increased economic instability.
He said: "When we don't set our own interest rates the economy becomes more unstable.
"Within the eurozone, the variability of British output, employment and prices in response to shocks would probably be much increased."
Minford argues that the benefits of joining the euro, such as savings in transaction costs estimated to be around Â£1bn a year, would be more than off-set by the Â£3 bn cost of the changeover.
He said that while joining the currency would eliminate exchange rate fluctuations with eurozone countries, fluctuations between the euro and the dollar have been "considerable".
He added that as a global trading country, Britain currently carries out more than 50% of its trading in the dolla