Daily currency report

The US dollar was the major winner, rising against all the other major currencies, well supported by a third consecutive rise in Durable Goods orders. In the UK, market reaction was relatively muted as the Chancellor of the Exchequer, Alastair Darling, delivered his 2010 Budget speech to Parliament. Instead, investors preferred to focus on the euro, as Fitch's rating's agency downgraded Portugal's sovereign debt rating, and arguments rage on over the exact nature of support package for Greece. By the close of business, the euro had sunk to a fresh 10-month low against the US dollar as falling to a new record low against the Swiss franc.

Sterling

Market reaction was relatively muted as the Chancellor of the Exchequer, Alistair Darling, delivered his 2010 Budget speech to Parliament. Over the course of the day, the pound did drop to a two week low against the US dollar, but ended significantly higher against the euro as markets judged the budget to be fiscally neutral, with most of the crucial detail over how the UK is to reduce its huge deficit deferred until after the election.

US Dollar

In another strong session, the dollar rose to a two-week high against sterling and also hit a 10-month high versus the single currency. The dollar has benefitted significantly from ongoing concerns in the euro zone in particular.

Euro

The single currency is beginning to look very weak indeed as debate rages on as to how exactly member states should support Greece and the debt crisis threatens to spread. Portugal became the latest country to have its sovereign debt rating downgraded by Fitch, who cited, "significant budgetary underperformance in 2009", and "structural weakness". The euro had already come under pressure earlier in the session as it appears increasingly unlikely that the EU summit will result in a clear pledge of financial support for Greece.

Japanese Yen

The yen came under pressure even though trade data surprised on the upside. Exports grew by the most in 30 years, going a long way to reassure investor that the economic recovery is still on track. Nevertheless, policymakers are still erring on the side of caution, and Bank of Japan policy board member, Hidetoshi Kamezaki, became the latest official to warn that deflation remains a very real threat.