The sterling may rise against the Yen as Equities rally

The pound may rally against the yen and the dollar as an expected Bank of England interest-rate cut will boost growth prospects and technical charts predict a rally, UBS AG and Citigroup Inc. said. Investors should buy the pound against the yen as the U.K. currency strengthens ``possibly as high as 180,'' wrote New York- based Tom Fitzpatrick and London-based Shyam Devani, technical analysts at Citigroup, in a research note yesterday. The BoE will cut rates 50 basis points to 4 percent tomorrow. The GBP/JPY is currently trading at 157.80 as of 8:52am, GMT.

The dollar gained against the euro on speculation Barack Obama's sweeping victory in the U.S. presidential election will help him push through policies needed to revive the world's biggest economy. ``This is a victory by a big margin and suggests a stable government, making it easy for Obama to conduct policy,'' said Akifumi Uchida, deputy general manager of the marketing unit at Sumitomo Trust & Banking Co. in Tokyo. ``The dollar is likely to be bought further.'' Three weeks ago, Obama increased the proposed cost of his ``middle-class rescue plan'' to $175 billion from $115 billion. He will be able to seek support for stimulus spending when Congress returns in less than two weeks. The EUR/USD is currently trading at $1.2877 as of 9:00am, GMT.

The Australian dollar advanced to two-week highs as U.S. equities posted their biggest Election Day rally in 24 years, prompting investors to buy higher-yielding assets. The Aussie ``has long forgotten the surprise 0.75 percentage point cut yesterday and the focus remained on increased risk appetite,'' wrote Toronto-based Matthew Strauss, a senior currency strategist at RBC Capital Markets Inc., a unit of Canada's biggest bank by assets. ``Increased risk appetite benefited equities, commodities and carry trades.'' The AUD/USD is currently trading at 0.6875 as of 9:44am, GMT.

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