On Thursday, trading was very mixed with an array of economic data out. While the BoE raised their interest rates to 5.75 per cent, the ECB kept theirs on hold four per cent.

GBP
The BoE raised interest rates for the fifth time since August concerned inflation will stay above their target, adding investor speculation that another hike is likely this year. Inflation has held above the bank's two per cent target for more than a year as the economy has grown at its fastest pace in three years. Off the back of this the pound hit a 26-year high against the dollar.

USD
The dollar fell against the pound but rose versus the yen and the euro after an unexpected gain in US service sector activity, slightly easing the pressure on the Fed to cut interest rates this year, however remaining concerned as low unemployment rate and rising labour costs will lead to higher prices, unconvincing policy makers of a tamed inflation.

EUR
While policy makers around the world are raising interest rates to tackle the threat of accelerating inflation, Jean-Claude Trichet said that borrowing costs in the euro region are still low enough to support economic growth after that ECB kept their interest rates on hold.

JPY
Weaker than expected leading economic indicators in May sent the yen tumbling against higher yielding currencies. The carry trade is very much alive with the AUD and the NZD hitting fresh decade highs against the yen. As long as risk aversion remains low, high yielding currency pairs will continue to benefit. The yen could continue to be weighed down by the near future.