Daily Currency Report
Market overview
News from Japan, the UK and the eurozone have been driving the dollar's fluctuations. Markets expect this to continue for the remainder of the week.
GBP
The sterling slid to a six-week low versus the euro and dropped sharply against the dollar after the Bank of England said some depreciation of the real exchange rate would probably be necessary. Traders noted the sharp reaction was overdone, as the Bank of England commented policymakers could still decide to raise interest rates from the current 5.25 per cent in March.
USD
The dollar hit a six-week low against the euro, still feeling the sting after weak economic data last week, which included Philly Fed survey, jobless claims, housing stats, consumer confidence and producer prices.
EUR
The eurozone has been showing signs of growth over the last month and the currency's latest movements reflect that.
JPY
A potential rate rise by the Bank of Japan would do little to help the beleaguered yen. Traders still believe the yen is in for a rough ride with higher rates at 5.25 per cent in the US and the UK and 3.5 per cent in the eurozone, with expectations of further rate rise to four per cent by the end of the year.