Lira/euro rate

Attention is drawn to a letter by Joseph Mizzi (August 15), regarding exchange rate quotations of the Maltese lira, more specifically the exchange rate of the lira against the euro.

From November 1, 2004, six months prior to the Maltese lira's entry into ERM II, where the lira was pegged directly to the euro, the Central Bank of Malta changed the method of quoting the Maltese lira against the euro to come in line with the conventional way that the euro is quoted in international currency markets, that is, in units of the particular currency per one euro, or in the case of the Maltese lira, Lm0.4293 per euro (and not Lm.0.4294 as indicated in the letter). Three press releases dated October 28, 2004, March 14, 2005 and April 30, 2005 respectively were issued to inform the public of this change.

It is relevant to point out that a foot note to the table on exchange rates, which appears on the Bank's website, explains this difference in the derivation of the euro/Lm quotation. It also states that for all other currencies the Maltese lira is quoted as the main unit. This implies that one Maltese lira is equivalent to a number of units of foreign currency.

Here it should be mentioned that to obtain the exchange rate of one Maltese lira in terms of the euro the reciprocal of the euro/Lm rate should be used, that is the figure of 1 should be divided by the rate of 0.4293 resulting in an Lm/euro rate of Lm1= €2.3294.