Sterling recovered from a five-month trade-weighted low, however, remains broadly the weaker party against all major currencies, but greater risk appetite re-entering the market has allowed sterling to rise against a flailing US dollar. As well as this investors have shied away from ploughing more funds into euro positions ahead the European Central Bank rate announcement.

Sterling

There is a level of positivity moving for sterling after some recovery was seen. A weaker USD allowed sterling to make gains as risk appetite re-entered the market, drying up recent safe haven flows into the greenback. As well as this a largely soft euro, bred from conservative trading in the run-up to ECB rate announcement, allowed sterling to recover from its abysmal start where it had hit five-month trade-weighted lows.

US dollar

Several factors have weighed on the greenback, all of which culminated in heavy selling pressure as investors exited out of safe haven positions in the dollar, as well as the Japanese yen, and into riskier assets. As global economic sentiment improves, the US dollar declines and this was intensified after Asian equity market's rallied.

Euro

Despite wholly positive data released within the eurozone, markets were left largely uninspired. Despite clear evidence of economic recovery from the eurozone's largest economy, investors were cautious to continue ploughing into the euro ahead of the ECB meeting.

Japanese yen

The yen gained broadly as investors seemed to test how far Japanese authorities will allow the yen to strengthen before any decisive intervention is actually executed.