Such an outcome would probably mean that sterling continues to be strong, with the signal that this is likely to change coming from higher unemployment. 

He says that long-term inflation will stabilise at between 3 per cent and 4 per cent, rather than the 2 per cent rate or below that has been common in the UK in recent decades. 

What that would mean for the strength of sterling over the long term is a function of whether the medium-term inflation rate in the US and eurozone settles at a lower level than the 3 to 4 per cent range. 

If it does, then the normal interest rate level in the UK would probably be higher than in those countries, potentially boosting sterling. 

Strong sterling may benefit the economy as a whole. But with the majority of the earnings of FTSE 100 companies coming from overseas, the UK stock market does best when sterling is weak relative to the dollar, because the value of dollar profits increases when converted into sterling and paid back as dividends. 

So whatever the direction of sterling over the coming months, it will have a profound impact on the portfolios of advisers and their clients.  

David Thorpe is investment editor at FTAdviser