esterday’s counterintuitive move seems to indicate that markets positioning is really long Euros and subject to profit-taking selling pressure. The Euro fell in fact against almost every other major currency. Sterling was well supported by stronger than expected wage data.

The outstanding performer however was the Canadian Dollar, up sharply after the Bank of Canada hiked rates and sounded a very optimistic note on the Canadian economy, apparently unfazed by low inflation and a bubbly real estate market.

Today is a light data day in the major currency areas, so expect desultory trading unless we get further tape bombs from across the Atlantic in the Trump-Russia collusion investigation.

Sterling higher on strong labor report

Lower than expected unemployment and upward surprises in weekly earnings and job creation provided some badly needed support for Sterling, which had been suffering after a string of weak economic reports from the UK. The move against the US Dollar was modest, however, as real wages are still shrinking. The Pound fared better against the Euro, which suffered from technical factors.

Chair Yellen reiterates cautious optimism, uncertain outlook for inflation

Chair Yellen message changed little from recent communications in her testimony to the US congress. Optimism on the labor market was tempered by “uncertainty about when — and how much — inflation will respond to tightening resource utilisation.” She also reiterated her preference for a “gradual” approach to rate hikes. Expectations for future hikes fell slightly, and the Dollar fell against major currencies with the conspicuous exception of the Euro.

Today is a light data day in the US, although weekly jobless claims will provide a timely read on the state of the US job market.