Trade remained fairly thin on the ground as the lack of event risk and economic data released, left foreign exchange markets distinctly uninspired. Trade in sterling was therefore largely driven by sentiment, and the continued reaction to the Bank of England's decision to implement a further £50 billion of quantitave easing measures. Despite Ben Bernanke's reassurances that the results of the banking "stress tests" should reassure investors as well as bolster the dollar's position as the world's reserve currency, US equity markets fell allowing some safe-haven positions to be put back on.

Sterling

Sterling continued to hold onto some of the levels achieved in last week's sessions against the US dollar although the lack of data released left sterling's movements limited. Against the greenback the levels reached last week were maintained, fuelled by continuing positive sentiment within the US.

US Dollar

The USD rose as some safe have positions were put back on after global decline in stock-markets encouraged more conservative trading. The moves came in spite of Mr Bernanke's attempts to reassure markets that the results of the bank stress test should act only to encourage investors in the renewed health of the US banking system.

Euro

Despite Jean Claude Trichet's announcement on behalf of the world's leading central bankers that there was a sign of a pause in the economic slowdown in France, Italy, the UK and China, French industrial figures for March released yesterday fell by 0.25 per cent. Nevertheless, sentiment remained positive and the euro continued to approach seven-week highs against the US dollar, and continued to make improvements against sterling.

Japanese Yen

Falling global equity markets once again saw a return to safe haven trading and resulting in the Japanese yen improving against the euro and greenback, as well as higher yielding currencies such as the Australian dollar.