After a period of calm, caused by historically low interest rates, expanding central bank balance sheets and a decline in corporate hedging, there is a growing sense that the animal spirits in the currency markets may soon reawaken.
In focus are the Japanese yen, which has fallen sharply since October, and sterling, the world's worst-performing major currency this year. Sterling has declined against the euro from €1.24 per pound on the first day of 2013 to about €1.15 at the beginning of March. This 7.5% swing represents more volatility than during the whole of 2012.
