Daiuly currency report

With European markets closed all eyes turned towards the UK and the US, where both the strength of the pound over recent weeks and the impending bankruptcy of General Motors Corp. took centre stage. The pound again rallied against most of the majors as investors continued to invest in riskier assets and sold the dollar to fund these purchases. Across the pond General Motors Corp. filed for bankruptcy as the Obama administration began the process of trying to revive the distressed icon of American industry by extending unprecedented federal funding and oversight.

Sterling

Sterling continued to make gains on the FX markets as share prices rose on expectations that the worst of the financial crisis may be over, encouraging investors to slowly make their way back into riskier assets. The pound leaped to a seven-month high versus the dollar, while also making smaller gains against both the euro and the yen.

US Dollar

The dollar steadied after hitting multi-year lows against the euro, sterling and a basket of other currencies as reassuring economic data and a rally in global shares reduced demand for the safe haven dollar.

Euro

The euro fell back from the highs it posted against the dollar, as the euro benefited from the sell off in the dollar as investors slowly edged back into riskier assets. The euro reached the highest level this year against the greenback as data released in the Euro-zone prompted investors to purchase the euro against most of the major crosses.

Japanese Yen

The yen continued to struggle against most of the major currencies as Finance Minister Kaoru Yosano, stated that Japan's worst post-war recession had hit rock bottom and that a full recovery may not materialise until early 2010.