The dollar has depreciated sharply against the euro and more modestly against the yen with dollar sentiment deteriorating as fears increase over the outlook for the US economy.

The yen is being supported by a liquidation of short positions.

I think it's inevitable that Governor Fukui will indicate we're that bit closer to the end of quantitative easing but I still think the message will be one of relative caution.

There has been a shift this week towards expectations of another U.S. interest rate rise in March -- the interest rate differential is there and it is helping the dollar.

The broader picture for the yen's decline is down to the continued deterioration in Japan's trade surplus.

The consensus is that we are definitely going to war and it's probably two to three weeks away, no more than that. We can take it as a given that the Bank of Japan is in the market at or around 117, so that the low we have tested in the past at 116.80 remains intact.