Daily currency report

There is no sign of the US dollar's decline coming to an end as the greenback plumbed new depths across the board. The dollar traded at a fresh record low against the euro, moved below the psychologically important 100 yen level for the first time in 12 years and also came close to a historic parity with the Swiss franc. Even the pressured sterling made moderate progress against the greenback.

GBP
Due to dollar weakness, the sterling rose against the dollar as a wave of selling pushed the greenback to a series of lows across the board. Evidence of this can be found in sterling's relative weakness against the other major currencies, as it lies close to an all-time low against the euro, but has also slipped heavily against the Japanese yen and the Swiss franc.

USD
The dollar sell-off accelerated as the economic outlook for the world's largest economy deteriorates by the day. Attention turns on the release of core inflation data, although even a high reading here would be unlikely to divert the Federal Reserve from its predicted interest rate cuts.

EUR
The euro has maintained its recent strength hitting records highs against the US dollar on an almost daily basis. European Central Bank President Jean-Claude Trichet has spoken out saying that that the movements in exchange rates are undesirable from the point of view of economic growth.

JPY
The yen reached a 12-year-high versus the dollar with the recent strength attributed mainly to the softness of the dollar. For the past two weeks, risk aversion and fears of a global downturn in economic expansion have led the yen to rally against most of its major counterparts.