"Safe haven" currencies such as the US dollar and the Japanese yen were sold off to fund stock acquisitions, as investors' appetite for risk was whetted by the chance to take profit before the US Federal Reserve's monetary policy meeting concludes. The pound continued to shine, and was the modest winner of trading. Abysmal retail data for the UK saw sales falling for the tenth consecutive month. However, this was offset by a large positive increase in the CBI's distributive trade survey for the month. Meanwhile, in the eurozone, Germany's IFO survey was well received as it came in far better than expected. This helped the euro make headway in the markets, gaining significantly against both the US dollar and Japanese yen.

Sterling

The sterling hit a fresh one-week high against both the US dollar and Japanese yen as better than expected news on the economy encouraged investors to buy the pound once again. The sterling's change of fortune came in spite of data that showed High Street sales fell for the 10th consecutive month during January.

US Dollar

The slow but steady return to equity market investments continued to be fuelled by a sell-off of 'safe haven' currencies including the dollar. The greenback also came under further pressure as figures revealed US consumer confidence had fallen to a new record low of 37.7 in January.

Euro

The single currency ended higher against both the US dollar and yen as Germany's IFO survey, a closely watched gauge of business confidence, surprisingly rose during January. The news far exceeded expectations of yet another decline and represents the report's first improvement in eight months.

Japanese Yen

Chinese New Year celebrations continued giving Japan another day of unopposed trading against its regional competitors. The cautious return to risk saw investors selling off their yen reserves to invest in the rallying equity markets.