Salient to Investors:
The British pound advanced for the first time in 3 years against the dollar in 2012 and advance for the fourth year against the euro. The median analyst expects the pound to end 2013 at 79 pence per euro and at $1.60, and the 10-yr gilt yield to rise to 2.38 percent.
Neil Mellor at Bank of New York Mellon said he doesn’t buy into the euro-positive story and ultimately sterling will be better placed against the euro. Mellor said no euro-zone country will have a positive year in 2013. Mellor said Sterling is one of the more difficult currencies to pin down, and will remain trapped between the euro and the dollar.
Sam Hill at Royal Bank of Canada said low and stable yields will continue to be an important part of the slow recovery.
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