The British pound gained more than 1%, rising up close to a three-week high after UK Industrial Production data growth beat expectations and boosted hopes that the UK economy is picking up its pace. S&P downgraded Greece on Wednesday further into junk status, from a CCC to a CCC, based on the delayed IMF repayment and its negative credit outlook. ECB’s Coeure stated that a Greek exit from the euro area would be “a serious warning sign for Europe because the question would inevitably arise as to whether such a scenario could be repeated.”
The Reserve Bank of New Zealand cut its interest rate late on Wednesday from 3.50% to 3.25% and stated that further easing may be applicable due to weak inflation pressure and a slowing down in economic growth. The surprising rate cut sent the ‘overvalued’ (according to RBNZ) New Zealand dollar down by more than 180 pips against the US dollar.
The greenback dropped to a two week low versus the Japanese yen after a BoJ head said that the yen was too week and would most likely not fall further. The comment sent the dollar down to 122.447 yen and the Dollar Index down to a three-week low of $94.29. Following the release of the WASDE report from the US Department of Agriculture, wheat futures dropped more than 3% on increased supply outlook, down to their biggest loss in the past two weeks, while ICE Cotton climbed higher due to declines in India inventory forecasts. Coming up on Thursday, the US Unemployment Claims data is due at 12:30 GMT.