Daily currency report

With the sterling doing great, the euro remains well supported, as interest rates there look set to rise too. The yen and the greenback, however, remain on the back foot as persistently weak data has given investors little incentive to buy either of the two currencies.

GBP

The pound hit a 15-year high against the dollar and also rose against the other majors as news of accelerating British inflation in March fuelled expectations of more BoE interest rate rises. The trigger was the news that British consumer price inflation rose to an annualised 3.1 per cent, over one per cent higher than the Bank of England's two per cent target.

USD

The greenback plunged down after the release of core US consumer prices which rose by less than expected in March. In contrast, investors are expecting the Federal Reserve to cut interest rates some time this year. With no significant economic data for the rest of the week, the dollar is left in a precarious position and could well be sold-off further.

EUR

The euro ended down against the sterling, but up versus the other majors as Germany's ZEW index showed that sentiment among German investors exceeded expectations in April. Last Thursday the ECB kept the interest rates on hold at 3.75 per cent, but suggested it is likely to raise rates in June or beyond to stem higher inflation.

JPY

Japan's consumer confidence index fell to 46.8 last month from 48.4 in February, the first fall in three months, the Cabinet Office said. The news did little to support the yen which remains on the backfoot across the exchanges.