Daily currency report

As the Bank of England announced it would keep interest rates on hold and make no further changes to its quantitative easing program, the pound began to strengthen almost immediately, hitting monthly highs against the dollar and weekly highs against the euro. The US dollar remains this week's worst performer, a combination of factors contributing to its demise including the ubiquitous return to risk appetite that has been endemic of falls in the greenback during recent months.

Sterling
The pound found some much needed respite after the Bank of England's Monetary Policy Committee voted to keep interest rates on hold at the record low of 0.5 per cent whilst maintaining their £17 billion asset purchasing program. Sterling activity had been relatively subdued in the run up to the Bank's meeting as traders and investors remained wary of any potential decision.

US Dollar
The US dollar remained on the defensive as even before the Bank of England's interest rate decision, the greenback had faced heavy pressure on all sides.

Euro
The euro continued to make most of its moves against a beleaguered US dollar. Although dollar weakness was the primary factor there were a number of eurozone releases from two of the top three economies which also contributed. Although the single currency fared well against most crosses, a correction following the Bank of England's interest rate decision saw it lose ground against the pound.

Japanese Yen
Much like its US dollar counterpart, the Japanese yen has come under selling pressure this week as risk appetite has returned amongst traders and market data has pointed to signs of an economy recovering from recession.

Commercial Foreign Exchange Travelex Malta, freephone: 800 733 22, www.travelex.com/mt/