Daily Currency Report

The euro dipped against the yen after reports that European officials are planning to warn the BOJ at the upcoming G7 meeting that low rates were distorting the yen's value, as more investors borrow yen to buy higher yielding assets.

GBP
Housing data released by Nationwide showed that UK house prices grew by 0.3 per cent over the month of January, the slowest growth rate for eight months, suggesting that higher interest rates could be impacting on the housing market.

USD
The dollar started the day slightly weaker versus the sterling and the euro but ranges were generally narrow overnight given the lack of data released. Dollar/yen stays near a four-year high as data showing soft consumer spending in Japan stirs more doubts about whether the BOJ will raise interest rates next month.

EUR
The economy of the 13 countries using the euro is estimated to have expanded by 2.6 per cent last year, the fastest growth in six years. This came in spite of forecasts in November and December that growth would slow because of the VAT rise in Germany.

JPY
The yen traded near its lowest level in more than four years against the dollar after government reports showed Japan's household spending fell 1.9 per cent in December from a year earlier. Falling consumption is expected to be a key reason for keeping interest rates at 0.25 per cent this month.