Last week saw the European Central Bank raise interest rates for the second time in three years to a level of 2.5 per cent, with the US dollar losing out as a result. This week sees interest rate announcements from the central banks in Japan, Australia and Canada.

GBP
The sterling gained ground versus the dollar, mainly due to the dollar's slide after the eurozone's interest rate rise. A strong UK service sector PMI figure helped to consolidate this gain and temper sterling's slide against the euro.

USD
The dollar suffered the greatest loss following the interest rate hike in the eurozone. In order to recover losses, the dollar will look to a strong US non-farm payrolls figure, as the release of this data usually results in the single largest move in currency rates for each month.

EUR
Eurozone interest rates now stand at 2.5 per cent. This was the second rise in the last few months. Before the first hike, the rates had been held constant for over two-and-a-half years and the latest rise has helped to boost the currency's independence.

JPY
The yen fell sharply as investors bet that the low interest rates in Japan would remain for a while. Even a slight increase in interest rates might help to kick-start spending patterns and prove as good psychological starting points to a sustained long-term recovery.