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Forex Flash: Oliver Twists´s Pound?

Sebastien Galy of Societe Generale feels that the pound is likely to continue falling, pretty much with the blessing of the UK’s MPC and the Chancellor.

He sees that in the Currency Wars‛ the UK is firmly on the side of the ‘quiet debasers’ who don’t intervene or talk their currency down loudly, but smile when it falls and talk positively about what a weaker currency does to rebalance the economy and tackle the trade and current account deficits.

However, Galy writes, “That doesn’t mean it’s a good idea. Inflation is imported and hits consumers, while the UK offers increasingly price insensitive exports that are heavily dependent on Europe. If the hope is that a weak pound will aid recovery, we suspect that hope will be disappointed for quite a long time. If the hope is that it will result in a weaker pound, it will succeed.”

Forex Flash: Eur PMIs dampened Investor recovery expectations - BTMU

Lee Hardman, FX analyst at the Bank of Tokyo Mitsubishi UFJ notes that the release of the latest euro-zone PMI surveys for February served to dampen investor expectations over the ongoing economic recovery in the euro-zone.
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Forex Flash: EUR strives to normalize, LTRO in focus – UBS

The ECB will announce the repayment details for the second LTRO at 11:00 GMT. As highlighted previously, “since last July the euro is striving to 'normalize', and a part of the process involves greater sensitivity to front-end rates – EONIA levels have been essential in strengthening this relationship, and regardless of how the ECB truly feels about it, further withdrawal of excess liquidity via large LTRO repayments will be much sought after by euro bulls, as the currency seeks to avoid heading into the upcoming Italian elections on the back foot.” writes Research Analyst Gareth Berry at UBS.
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