EUR/USD Yesterday, the euro was steady close to three-week highs against the dollar in quiet trade day, as Friday’s stronger-than-expected data on euro zone fourth quarter growth continued to underpin demand for the common currency. The shared currency hit 1.3724, the highest since January 24 and was last up 0.09% to 1.3704. Earlier Monday, Germany’s Bundesbank said the rate of economic growth in Germany is likely to gain momentum in the first quarter of this year after experiencing an upswing in the winter months. Today, euro started a modest rate against the greenback during the morning to be traded on average rate at 1.3700. GBP/USD The pound remained lower against the U.S. dollar on Monday, although it was hovering within close distance of a four-year high amid expectations that the Bank of England may raise the rates next year. The pound remained supported after the BoE raised its U.K. economic growth forecast for 2014 to 3.4% from 2.8% last week, and indicated that it may raise interest rates next year. In its quarterly inflation report, the bank also updated its forward guidance on bank rates, saying it will not raise rates until the spare capacity in the U.K. economy has been fully absorbed, which it sees happening in 2015. Cable hit 1.6710 during U.S. morning trade, the session low; the pair subsequently consolidated at 1.6723, slipping 0.16%. USD/JPY The yen weakened versus the U.S. dollar before the Bank of Japan concludes a two-day meeting amid speculation a weaker economy will require more stimulus in coming months. Japan’s currency slid against the greenback yesterday following data yesterday that showed the nation’s growth in the fourth quarter missed economist estimates. Japan’s currency slid 0.2% to 102.10 per dollar from 101.92 yesterday, when it lost 0.1%. USD/CAD The Canadian dollar backed away from one-month highs against the U.S. dollar on Friday as unexpectedly weak domestic manufacturing sales data reawakened concerns over the subdued economic outlook. Yesterday, loonie gained 0.18% to 1.0952 to keep on the same trend for the morning hence it started the day at 1.0955 and gained about 0.06% to 1.0947.

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