Daily Currency Report

Overview

The yen made the biggest gains against all the majors after traders continued to liquidate their carry trades and Japanese corporations continue to repatriate the yen ahead of the fiscal year end.

GBP
The pound ended weaker against both the US dollar and Japanese yen, but stronger against the euro. Economic data released was mixed with a sharp rise in manufacturing PMI and an increase in mortgage approvals offset by a drop in the CBI distributive trades survey and a drop in net lending securities on dwellings.

USD
The dollar dipped modestly after a government report showed the housing market cooled down more than expected. New home sales dropped 16.6 per cent to an annual rate of 0.937 million units in January, far below the estimate of a 3.4 per cent decline.

EUR
The euro has lost value against the US dollar and is looking very vulnerable ahead of the Germany retail sales and eurozone PPI numbers.

JPY
After a brief pause, the Japanese yen resumed its rally as traders continued to liquidate carry trades. This week's big moves have made investors in the global markets much more risk averse which means they will be reluctant to rebuild long positions.

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