Forex Flash: GBP/USD year-end target at 1.45 – Scotiabank

FXstreet.com (Barcelona) - The sterling is losing more than one big figure on Tuesday, rapidly falling from overnight highs in the vicinity of 1.5260 to the current area of 1.5110/15.
The pessimism surrounding the pound increased after the manufacturing PMI print remained in contraction territory during March, despite the advance to 48.3 from 47.9 in February.

Camilla Sutton, Strategist at Scotiabank, expects the BoE to leave its monetary policy intact on Thursday. “We do expect that the minutes will ultimately show a shifting balance towards asset purchase expansion. The dynamics in the UK are FX negative. We hold a GBPUSD year‐end 1.45 target”, concluded Sutton.

Apr 2, 2013

Forex Flash: GBP weakness is sufficient for UK reshuffle – Goldman Sachs

To determine the real exchange rate adjustment required to address the UK’s external imbalances, we use a framework that we have previously used to analyze the adjustments taking place within the Euro area. According to the Economics Research Team at Goldman Sachs, “In this framework, the size of the exchange rate adjustment required to rebalance the economy depends (in part) on the ease with which demand can switch to domestically produced goods and services. If one assumes that the relative price changes required to trigger such a switch are broadly consistent with past patterns, our results suggest that Sterling is now weak enough to rebalance the UK economy.”

Forex Flash: NZD looks to re-enter positive trend – Westpac

According to Global FX Strategist Sean Callow at RBS, “The NZD/USD move above 0.8355 puts the kiwi back into positive-trend mode. A quiet local calendar keeps the near term event risk firmly off shore but otherwise the pair looks a buy on dips towards 0.8470.”