Daily currency report

The pound hit a three-month low against the dollar as the Bank of England's quarterly inflation report shows inflation peaking at around 3.7 per cent in Q3 of this year before slipping to around 2.25 per cent in 2 years.

Sterling (GBP)

The sterling fell to its lowest level against the US dollar since February 20, after the release of Bank of England's inflation report. Also in the report, Governor Mervyn King said that a weaker pound would help rebalance the economy. Separate data in the UK revealed that the number of Britons claiming jobless benefits had risen for the third straight month in April, suggesting a slowing economy is starting to hit the job market.

US Dollar (USD)

The dollar gained against a basket of currencies as better than expected consumer prices rose less than forecast in April. The result enables the Federal Reserve to have some flexibility to deal with an economic downturn and cut rates again if they wish.

Euro (EUR)

Despite a dip in industrial output figure in the euro zone the euro held firm. The report showed that industrial production dipped in March against February and rose less than expected in annual terms mainly because of falling output of consumer goods.

Japanese Yen (JPY)

The release of government data for Japan's core private-sector machinery orders, a key gauge of corporate capital spending, showed a fall of 8.3 per cent in March, below economists' consensus forecast for a 5.5 per cent drop. The drop in March was the lowest in almost three years as companies became wary on investment in the face of a global economic downturn and sputtering domestic growth.