Over the last month the dollar was the top performer among the major currencies, strengthening by more than a cent against sterling and by two and a half against the euro. It did not enjoy the same success in the last week, adding just a quarter of a cent against the euro and losing a cent to the pound.

The provisional US purchasing managers' index readings pointed to stronger economic performance in the States. Durable goods orders were strong. The first estimate of Q2 growth at an annualised 2.3% was slightly shy of the forecasted 2.5% but the shortfall was more than offset by an upward revision to the previous quarter. The Federal Reserve's policy statement did nothing to alter investors' expectation that US interest rates will rise this year. So it was not that the dollar did anything wrong, it was just that investors preferred the pound.