Financial markets have not enjoyed an auspicious start to the new year. A sell-off in the Shanghai stock market unnerved investors.

They were made more nervous still by the Chinese authorities' clumsy efforts to support equity prices and by an 11-year low for oil prices. The result has been a flight to quality, with investors seeking refuge in the safe-haven currencies, especially the yen, and offloading those related to energy and commodities. Amidst all this the euro has been more a passenger than an active participant, benefitting from its perceived safety credentials. It is unchanged on the week against the US dollar.

Sterling, on the other hand, has been suffering from the evaporating hope of higher interest rates and from uncertainty about the looming referendum on Britain's continued EU membership. It is down by two euro cents on the week and by more than three in the year to date.