Sterling / Euro

With little data out in either Europe or the UK on Friday, the pair held steady during the early session with the pound gaining in the afternoon as investors booked profits.

• The markets were quiet during the European session with traders unwilling to take up long positions ahead of key US employment figures.
• The numbers had little immediate impact, though sterling did eventually close the day half a cent higher, edging back over 1.11, as market players continued booking profits having taken the UK currency to a three month low earlier in the week.
• In trading this morning the pair is relatively flat, though support for debt-laden Greece should prevent the euro from slipping too far.
• In a bid to calm markets, French President Sarkozy promised Greece that euro zone countries would help it overcome its financial problems and vowed a crack down on financial speculators.
• Sentiment towards the UK remains fragile on a weak economic outlook and political uncertainty and with little data out this week, the pound could continue to trade around this level.

Sterling / US Dollar

Positive data from the US labour market boosted demand for riskier assets on Friday, which enabled the pound to post gains of over a cent.

• Having traded steadily throughout the morning, sterling strengthened after a report showed that the US lost fewer jobs last month than economists had predicted, stoking optimism the global economic recovery is gathering pace.
• Data also revealed that the US unemployment rate remained at 9.7%, against market expectations of a rise to 9.8%.
• The news reinforced views that the US economic recovery was intact and saw the dollar move broadly lower in afternoon trading as investor took the opportunity to book profits.
• Sterling also enjoyed some support from rallying equity markets with the FTSE-100 index testing 5,600, a level it has not closed above since September 2008.
• In trading this morning, the markets are continuing to take direction from Friday's employment figures, with the greenback under selling pressure. The pound is currently nearing $1.52.

Euro / US Dollar

Having fallen sharply on Thursday, the euro enjoyed some upward movement on the final day of the week, moving back over 1.36 as US non-farm payrolls impressed.

• The US Labour Department said employers eliminated 36,000 jobs in February after a reduction of 20,000 in January. The median forecast had been for a decrease of 68,000.
• The single currency climbed steadily in the wake of the data in line with other riskier asset classes.
• In addition concerns about debt problems in Greece eased after a sale of 10-year bonds on Thursday attracted strong demand.
• Greece is again the topic of discussion this morning, with French Prime Minster Nicolas Sarkozy backing his support for the troubled nation and preparing to crackdown on speculators that have "abused" the Greek credit market.
• Currently the euro is trading 0.3% higher, with the price hovering around 1.3650.

Rest of the World

Australian Dollar

Rallying stock markets and upbeat news from the US supported a rise in risk appetite late on Friday, which underlined demand for the aussie.

• Stock markets and risky currencies alike headed into the weekend on high notes, as optimism in markets snowballed.
• The buoyant mood has carried over from Friday after better-than-expected US labour market result and a calmer situation in Greece following supportive comments from France.
• An announcement this morning of a joint bid from Shell and PetroChina for Australia's Arrow energy underscores Australia's solid economic recovery that is underpinned by a lucrative, mainstay mining sector.
• However, the Australian dollar is struggling to push too much higher against the pound this morning with the aussie already at such a high..

New Zealand Dollar

Having enjoyed a three day rally against the kiwi earlier in the week, sterling slipped back 0.8% on Friday as renewed optimism drove the price of higher-yielding assets.

• In similar fashion to the Australian currency, the kiwi was boosted on Friday afternoon as the positive news from the US supported confidence in the global economic recovery.
• The kiwi is again gaining this morning with the mood little changed from Friday.
• However, traders may be cautious toward the New Zealand currency in the early part of this week with the Reserve Bank due to give an interest rate announcement on Wednesday evening. Market forecasts do not expect the rate to be changed from 2.50%.