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Pound 'will Fall To Parity With Euro' Within Months

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From today's Telegraph:

Pound 'will fall to parity with euro'

Sterling weakened yesterday to close at just over 90p to the euro for the first time in four months, amid renewed concern over the state of the British banking system.

By Angela Monaghan

Published: 8:36PM BST 18 Sep 2009

The low came as currency experts predicted the pound would fall further and reach parity with the euro within the first three months of 2010. One euro was worth as much as 90.36p, the highest level close since May 11. A year ago a euro would only buy 79p.

Confidence about the UK currency was eroded when issues surrounding Lloyds Banking Group's participation in the asset protection scheme once again put the spotlight on Britain's financial system, highlighting the problems that remain.

Currency strategists at BNP Paribas suggested sterling's weakness was not just a short-term blip because sterling would be dragged down by ongoing loose monetary conditions in the UK, relative to the eurozone.

"Sterling is likely be the underperformer among the majors, despite a favourable global financial market environment, as the UK domestic picture is set to deteriorate, with the fiscal/monetary policy mix in particular working against sterling," they said in a note............

Daily Telegraph

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This may be our hpc. Euro buyers must find the UK a bargain now. Such a shame Gordon has made UK citizens poorer in their own land. I can see foreign investors flocking to central London for investment opportunities but flogging them a BTL in Scunthorpe might be slightly more challenging.

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From today's Telegraph:

Daily Telegraph

Pound to Euro parity by Q1 2010 eh..

Any bets on when this happens with a few other currencies as well.

I reckon very possible for the strongly resource based non money printing AUD and CAD to follow suit within 2-3 years (these are already trading down at record highs for recent years around 1.7-1.8 odd to the £, and perhaps the NZD (now at something like a 12 year high at 2.31) might make it sometime after as well.

All good for Gordo and should do wonders to keep house prices up as they will be cheap as chips for all the johnny foreigners. Just back the pound into all these other currencies. At least don't have to worry about the USD, they are printing just as fast as Gordo..

The standard of living is going to fall through the floor and inflation through the roof as the buying power of the pound drops, but hey at least we can live it up in our highly priced (in pounds) houses..

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