Daily currency report

The US dollar continued its recovery buoyed by a pullback in oil prices, stock market gains and an ailing pound after growth data from Friday, strongly suggested a recession in Britain. The dollar continued to climb also towards a six-month high against the Euro, ahead of the German IFO survey of business sentiment, with investors seeking clues on whether the eurozone economy is hurting enough for a cut in interest rates. This week got off to a slow start in terms of economic data, with the UK closed for a bank holiday.

Sterling (GBP)

The sterling skidded to its lowest level in nearly 12 years on a trade-weighted basis, falling against the dollar and euro after a report showed the economy unexpectedly stalled in the second quarter. Investors dumped the pound when a gross domestic product reading was revised to show it was unchanged in the three months to June from an initial estimate of 0.2 per cent quarterly growth.

US Dollar (USD)

The dollar rose for a second day against the Euro, on speculation a drop in oil prices will support growth in the world's largest energy consumer. The US currency also jumped against the Australian and New Zealand dollars as renewed jitters about the financial sector highlighted by the ninth US bank failure this year, prompted market players to trim carry trades.

Euro (EUR)

The euro weakened against the dollar and the yen on speculation declines in German business confidence will discourage the European Central Bank from raising interest rates.

Japanese Yen (JPY)

The yen peaked to fresh session highs this against the dollar as plunging shares on Wall Street heightened risk aversion.