HSBC - "It is tempting to believe that the strong UK economic data will continue as the housing market comes back to life and consumers continue to increase their spending. If this were the case, then the Bank of England would find it very difficult to keep rates at a record low for a further long period, and the recent rally in sterling could continue. However, the more likely case is the upside surprises in the UK turn into downside surprises as the reality of negative real income growth come back to bite. Meanwhile, in the US tapering is just a matter of when not if. In this case, we are likely to see sterling reverse much of its recent rise particularly against the USD."