Happy new quarter! The 1st quarter of 2013 has seen US and UK equity markets rally into new highs; the euro rally until Cyprus hit; and sterling plunge to new lows all the while. As the new quarter gets underway, it is an interesting time to think about sterling rally. Since Cyrpus has undermined confidence in the European banking system, the $EURGBP has fallen accordingly. Likewise, the $GBPUSD, $GBPAUD, $GBPNZD and $GBPCAD are failing to move lower after hitting new yearly lows. It stands to reason that this next quarter could bring a sizable correction to GBP weakness as sterling enjoys safe haven flows and a central bank on hold until its new governor takes the helm.
- Bank ‘poised’ for more QE to avert triple dip (Telegraph)
- Pound selling accelerated to 17-mth low positioning (StockTwits) [CHART]
- Euro-area safe haven appeal here (StockTwits) [CHART]
- 6 Reasons Why We Buy $10 Million GBP/USD At 1.5183 Targeting 1.5758 (eFXnews)
- Currency Wars (StockTwits) [CHART]
- Has the UK finally lost its safe haven status? (Credit Writedowns)
- Is the Dow the New Safe Haven? (CNBC)