Further gains for sterling on the horizon

Tight trading ranges for the main forex rates were a key feature of the currency markets in 2013, apart from the yen, which fell sharply.

The euro/sterling rate was largely confined to a 83p-87p range in 2013, while the euro/US dollar spent most of the year trading in a $1.28-$1.36 band.

Last year, FX markets operated against a backdrop of central banks moving into forward guidance mode and trying to convince markets that interest rates could remain at low levels for an extended period of time. This helped to keep the main currencies quite range bound.