Sterling dipped against the dollar, staying close to a nine-month low against the dollar and hitting a six-week low against a basket of currencies as concerns about a weak economy and high levels of UK debt continued to put the pound under selling pressure. Elsewhere, the euro remained steady, helped mainly by a report from German weekly paper Der Spiegel, that Germany's finance ministry had prepared plans for the eurozone countries to help Greece. There was a somewhat shaky return to risk appetite, sparked mainly by investors reassessing the chances of a near term interest rate hike by the US Federal Reserve, despite the Fed's surprise decision to increase its discount rate last week. Oil prices also rose to a six-week high, weakening the greenback.

Sterling

Sterling started the week where it finished last week after a run of bad data - on the back foot. With very little in the way of data to offer any relief, it dropped against a basket of currencies as well as hitting a near nine-month low against the dollar.

US dollar

The dollar weakened as investors reassessed the chances of an earlier-than-expected interest rate hike by the US Federal Reserve, prompting a degree of recovery in risk appetite. The Fed's discount rate decision last week was taken as a signal by currency markets that the US central bank was coming closer to tightening its benchmark rate, despite assurances from Fed policymakers to the contrary.

Euro

The euro remained pretty steady throughout the course of trading even though speculation regarding a quick bail-out of Greece was being discussed, A weekend report by German weekly publication Der Spiegel, that revealed that Germany's finance ministry had prepared plans for the eurozone countries to help Greece, was also very positive but did very little to strengthen the euro's long-term appeal.

Japanese yen

The Japanese yen gave up early gains as Shanghai's stock market reopened in a relatively stable fashion after a week-long holiday, putting to rest fears that this month's decision by China's central bank to raise banks' required reserves could trigger a slide and hurt investors risk appetite.

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