A pounding for sterling in 2013?
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The year has begun with mutterings about the pound - with some suggesting that it is about to fall off a cliff.
You won't get my prediction here. Economic forecasting is a dodgy business at the best of times, and currency forecasts are the least reliable of the lot.
But it's easy to see why the pound could weaken in 2013. David Bloom, for example, of HSBC, predicts that 2013 will be the year in which the currency's "underlying frailties will be exposed".
For starters, the lack of a decent recovery means that the Bank of England may have to loosen monetary policy even further this year, meaning that the market interest rate that foreigners can earn holding sterling will stay very low.
If the government loses its top AAA credit rating - as many expect - that could also reverse some of the "safe haven" flows into sterling that we have seen over the past few years. Especially if people decide (rightly or wrongly) that the fears hanging over the eurozone and the US have gone away.
That comparison with other countries is the key. After all, it's not as though our economy looked so great in 2011 and 2012. It was just that other places looked even worse.
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