214. Message From Prime Minister Eden to President Eisenhower1

It is not our policy to have the kind of floating £ which is now being talked about.2 Our aim must be the stability of sterling as an international currency, together with reasonable flexibility.

Widely or wildly fluctuating rates for the pound would be bad for world trade and for sterling. Such a policy has never been part of our ideas.

We have kept the United States authorities fully informed about our ideas on eventual convertibility which have not changed. The Chancellor of the Exchequer3 has explained them to the Secretary of the U.S. Treasury. We will continue to keep in close touch with the U.S. authorities on our proposals.

  1. Source: Department of State, Presidential Correspondence: Lot 66 D 204. The President and Prime Minister were in Geneva to attend the Summit Conference, July 18–23. A handwritten note by the President appears at the end of the source text: “To Geo. Humphrey—A note, handed to me this a.m. by Sir Anthony, DE.” Secretary of the Treasury Humphrey was also at Geneva.
  2. In notes dictated on July 19 regarding his conversation alone with Eden on July 17, the President recorded: “Eden informed me that they have no intention at present of attempting to go to convertibility. This largely eliminated any discussion of the ‘floating pound’ except that I did say that he did say that if ever they took up that matter, there would be fixed and very narrow limits outside of which the pound would not be allowed to go.” (Eisenhower Library, Whitman File, ACW Diary) This private conversation is also referred to in a memorandum by Secretary Dulles, July 17, vol. V, p. 343.
  3. Richard A. Butler.