What is the 'IEP (Irish Pound)'

IEP (Irish Pound) was the foreign exchange (FX) currency symbol, for the Irish pound, the money of Ireland until 2002. The Irish pound comprised 100 pennies, called pingin or in Irish, and often appeared with the symbol £ or IR£ to set it apart from other currencies based in pounds. The Irish term for the Irish pound is the punt Éireannach.

BREAKING DOWN 'IEP (Irish Pound)'

IEP dates back to the first millennium C.E. Following the Act of Union, which joined Ireland and Great Britain into one kingdom, this first Irish pound assimilated into the British Pound.

After the Irish Free State formed in 1922, trade with the U.K. continued to dominate the Irish economy. The government did not see the need to prioritize the creation of a new currency. It wasn’t until 1927 that the Irish government began issuing the Irish pound, pegging it to British sterling at parity. The government also promised full convertibility to the Great British Pound (GBP) sterling.

For more than a decade, the Irish government managed its currency through a Currency Board. In 1942, the legislature passed a law to establish the Central Bank of Ireland. Even after creating the new monetary authority, Ireland retained pegging of its pound to the pound sterling. This practice continued still after Ireland departed from the Commonwealth and declared a Republic in 1948. When the pound sterling was devalued within the Bretton Woods system in 1949, and again in 1967, Ireland did not change its currency's pegging.

The 1970s were a decade of monetary reform in Ireland. First the nation decimalization the Irish pound and then with the Central Bank Act of 1971. This Act delegated new powers to the monetary authority and ultimately led to Ireland’s participation in the European Exchange Rate Mechanism (ERM) in 1978. In 1979, the formal link with the British Pound was, at last, broken.

The Euro Replaces the Irish Pound

Momentum for the creation of a single, pan-European currency began to gather support in 1986, with the signing of the Single European Act, setting the stage for a market without frontiers. A logical complement to this borderless market would be a single, unifying currency.

Ireland was one of the earliest countries to adopt the euro on the first of January, 1999, fixing the value of the Irish pound to the euro at the rate of 0.787564 Irish pounds. For three years, the euro existed as a virtual currency for bookkeeping purposes. It wasn’t until January 2002 that the circulation of euro banknotes and coins in Ireland began.

According to World Bank data, Ireland experiences a negative 0.3% annual inflation rate deflator and has a gross domestic product (GDP) growth of a 7.8%, as of 2017, which is the most current year of available data.

RELATED TERMS
  1. Double Irish With A Dutch Sandwich

    The double Irish with a Dutch sandwich is a tax avoidance technique ...
  2. Euronext Dublin

    Euronext Dublin was formed in March 2018 when the Irish Stock ...
  3. GBP

    GBP is the abbreviation for the British pound sterling, the official ...
  4. Cable

    Cable is a term used among forex traders referring to the exchange ...
  5. Celtic Tiger

    Celtic Tiger refers to the country of Ireland during its economic ...
  6. Quid

    Quid is a nickname for the British pound, also called the pound ...
Related Articles
  1. Investing

    The Story Behind The Irish Meltdown

    Once a lesson in national renewal, Ireland is learning that success can be fleeting. Learn the story behind Ireland's crumbling economy.
  2. Taxes

    Ireland Economics: 3 Troubling Similarities to Greece

    Discover how recent political changes in Ireland could compromise years of balance sheet improvements and economic growth, risking a Greece-like calamity.
  3. Retirement

    How Much Money Do You Need to Retire in Ireland?

    After the Celtic Tiger's boom and bust, retiring in Ireland may be more affordable than you think. Here's an overview of what to expect.
  4. Insights

    Tax Wars: U.S. Companies Are Targets (AMZN, SBUX)

    The EU is targeting Amazon, McDonald's, Starbucks and others. Tax avoidance is big business, pitting governments, the EU and companies against each other.
  5. Insights

    Apple Has to Pay up to $14 Billion in Back Taxes Plus Interest (AAPL)

    The European Commission has ruled that Apple received unfair tax benefits from Ireland.
  6. Insights

    Wall Street Likes St. Paddy's Day

    Historically, the S&P 500 has been more likely to rise on St. Patrick’s than the vast majority of other days in the year.
  7. Retirement

    Find the 5 Top Places for Retiring in Ireland

    From historic, bustling Dublin to the seaside villages of the coasts, these appealing Irish towns deserve a spot on your retirement-destination radar.
  8. Personal Finance

    Apple’s Japan Unit Ordered to Pay $118 Million Tax Penalty (AAPL)

    Apple’s iTunes unit in Japan was sending earnings from software licensing fees paid by Japanese customers to an Apple unit in Ireland.
  9. Investing

    Guinness Exports Subject to Brexit Uncertainty

    Major corporations fear the return of a hard border at the UK's only land border with the EU.
  10. Investing

    How Brexit Can Impact the Euro and the U.S. Dollar

    Find out why Brexit could threaten the short-term stability of the British pound sterling and the euro, and why the U.S. dollar stands to benefit.
RELATED FAQS
  1. Why the British Pound Is Stronger Than the U.S. Dollar

    Learn why the British pound is stronger than the U.S. dollar, despite the U.S. economy being larger than that of Britain ... Read Answer >>
  2. How can I trade in cross currency pairs if my forex account is denominated in U.S. ...

    The forex market allows individuals to trade on nearly all of the currencies in the world. However, most of the trading is ... Read Answer >>
  3. How do you make money trading money?

    Trading money, particularly in the forex market, is a speculative risk, as you are betting that the value of a currency will ... Read Answer >>
Hot Definitions
  1. Yield Curve

    A yield curve is a line that plots the interest rates, at a set point in time, of bonds having equal credit quality, but ...
  2. Portfolio

    A portfolio is a grouping of financial assets such as stocks, bonds and cash equivalents, also their mutual, exchange-traded ...
  3. Gross Profit

    Gross profit is the profit a company makes after deducting the costs of making and selling its products, or the costs of ...
  4. Diversification

    Diversification is the strategy of investing in a variety of securities in order to lower the risk involved with putting ...
  5. Intrinsic Value

    Intrinsic value is the perceived or calculated value of a company, including tangible and intangible factors, and may differ ...
  6. Current Assets

    Current assets is a balance sheet item that represents the value of all assets that can reasonably expected to be converted ...
Trading Center