Wall Street Journal speculates Ireland ready to print Irish punts

The Irish Central Bank has denied it is in negotiations with printing companies in case it needs additional capacity to print Irish punts.

A spokeswoman for the bank said on Wednesday, “We are only printing euros”.

Their denial follows an article in the Wall Street Journal which said “the Central Bank of Ireland—is evaluating whether it needs to secure additional access to printing presses in case it has to churn out new bank notes to support a reborn.”

The Journal noted “The first signs are surfacing that central banks are thinking about how to resuscitate currencies based on bank notes that haven't been printed since the first euros went into circulation in January 2002.

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This article was soon tweeted by economist Brian Lucey (@brianmlucey) who said, “The Wall Street Journal would only print this central bank/punt printing story if they had VERY high sources.”

What is certain is that not everyone believes the denials from the Central Bank and the Irish Government.

Ireland’s largest company, cement-makers CRH, has confirmed with Bloomberg Television that they are making preparations for the possibility that Ireland will exit the euro zone. Myles Lee, the company’s chief executive, said that while the idea of it actually happening was “hopefully unthinkable” he explained that his company has a contingency plan. He added that “any responsible company should have [a plan] in place”.

Ireland’s Minister for European Affairs, Lucinda Creighton told RTE she has “no knowledge” of any plans for printing the punt.

When questioned on the matter in the Dail (Parliament), Ireland’s Minister for Finance, Michael Noonan, said no punts had been printed since 2001.

Willem Buiter, chief economist at Citi, told the Irish Times that a full splintering of the euro zone would “create financial and economic pandemonium”. He wrote that this would include disorderly sovereign defaults, dramatically weakened currencies, and bank failures.

“If Spain and Italy were to exit, there would be a collapse of systemically important financial institutions throughout the European Union and North America and years of global depression.”