Daily Currency Report

Overview

The main focus of attention for the FX markets is all centred on interest rates. The Fed, BOJ and ECB all look likely to raise their rates, with just the BoE keeping rates on hold.

GBP
The sterling hit a two-month low against the euro on signs that the pound's yield advantage over the single currency will decrease this year.

USD
The dollar hovered near a two-month high against the yen as market players waited for a signal of another rate rise. The Fed also said that some further policy tightening may yet be needed to stem inflationary pressure.

EUR
The euro briefly hit a fresh record high against the yen and spiked up versus the dollar after strong German data, and comments from ECB officials raised the prospect of faster eurozone rate hikes.

JPY
The yen hit a two-month low against the dollar and fresh record lows against the euro as talk continued over the uncertainty of the future of Bank of Japan governor Toshihiko Fukui.

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