The Bank of England took centre stage with all eyes focused on their latest interest rate announcement. As expected the committee kept the base rate unchanged at 5.25 per cent. However, the sterling was hit hard on the back of the release to slump across the board.

GBP

The sterling fell sharply after the BOE's announcement to keep interest rates on hold for the month of February. The move pushed the sterling lower across the board and actually hit one-month lows versus the dollar and the euro.

USD

The dollar strengthened considerably against the sterling as economic data releases supported the dovish tone earlier in the day from the BOE. The number of Americans filing new claims for jobless benefits rose last week while wholesale inventories dropped unexpectedly in December in a good sign for US economic growth.

EUR

The European central bank was not to be overshadowed by its English counterpart as they also released their latest monetary committee decision. Although they also left interest rates unchanged, the ECB Governor stated that the central bank needed to exercise a "strong vigilance" on inflation.

JPY

The yen dipped again close to a four-year low against the dollar and at an unprecedented low against the euro ahead of the G7 meeting, which is unlikely to seriously tackle the yen's weakness.

Commercial Foreign Exchange Travelex Malta (Free phone: 800 77 33 22) www.travelex.com.mt

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