Sterling Digest, May 14 2012: safety trumps economics

Money makes the world go round
Investors want pounds

It appears that Friday’s theme was mere profit-taking as good news out of Canada and US was excuse enough to move some money off the table. Sterling is back on trend today with comm dolls leading the way. $GBPAUD, $GBPNZD and $GBPCAD have all broken out above their Friday highs in opening market action. While fundamentals point toward a deteriorating UK economic picture, risk flows dominate with GBP enjoys European safe haven status.

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