Sterling: Nothing to woof about
I was reminded this week by my old mucker Paul Day, deputy head of research at MIG Investments, of a prediction he made a year ago. He said sterling would be the dog of the FX market in 2008 and that it would plunge to parity against the euro – a prediction I thought singled him out as being barking mad.
Technically, there may well be a currency that has performed worse, but there’s no denial that sterling has been giving a right kicking against the JPY, USD, CHF and EUR. It seems that it will be only a matter of days before EUR/GBP breaks above 0.9000, which broadly equates to the 2.1700 all-time low it reached against the DEM way back in 1995. That milestone should provide some resistance.