The European single currency and the British pound rebounded against the dollar and yen on increasing speculations that the two giant European central banks will change the monetary stance soon.
The recent comments by European officials increased the possibilities of seeing an interest rate hike very soon as both ECB officials Yves Mersch and Nout Wellink mentioned yesterday that the ECB is ready to combat inflation by raising borrowing cost if needed.
Also, German Chancellor Angela Merkel said EU leaders are ready to discuss the possibility of easing bailout terms for Greece in next month's summit in a step that boosted some confidence that debt crisis in bailed out nations will not swell.
In the UK, BoE minutes released today showed another split in February but this time three out of the nine panel members called for an interest rate rise where Martin Weale and Spencer Dale asked for 25 basis points increase while Andrew Sentance raised his call to 50 basis points instead of 25 basis points, which indicates the BoE may respond to the ongoing pressure of members to raise interest rate in March, especially as February's inflation report stated that inflation will average 4.4% this year before it comes back to target by middle 2012.
Concerning the euro-dollar pair, it rebounded from to 1.3735 after the breach of resistance at 1.3715 which took the pair to a high of 1.3743 while the day's low was recorded at 1.3646.
The trading range for today is among the key support at 1.3540 and the key resistance at 1.3890.
Moreover, the pound also advanced on the daily scale to the previous two session's losses, but it halted its rise at it faced strong resistance at 1.6250, where it is currently trading.
The royal pair reached a high of 1.6272 and a low of 1.6131, where the trading range for today is among the key support at 1.6070 and the key resistance at 1.6415.
On the other hand, the dollar index, which tracks the dollar movements versus a basket of major currencies, fell to 77.43 from the day's opening at 77.82, despite the unrest in the MENA region and ahead of the release of existing home sales report which is expected to show 1.1% drop in January from the 12.3% advance a math earlier.
With regard to the dollar-yen pair, it is currently trading near the day's opening level at 82.78 after recording a high of 82.88 and a low of 82.51.
The trading range for today is among the key support at 80.80 and the key resistance at 83.70.