Sterling remained on the defensive as GBP/USD dipped below the 1.3050 level.

EUR/USD was again held in tight ranges during Wednesday with markets waiting for fresh evidence from Thursday’s Euro-zone PMI data.

Risk appetite held firm on hopes for improved conditions in China, although equities lost momentum on Thursday with caution also in evidence ahead of Easter holidays.

Canadian dollar gains on slightly stronger than expected inflation data reversed quickly, while solid employment gains helped protect AUD/USD. Oil prices were subjected to a correction with caution over the risk of higher OPEC output.

Defensive assets generally remained out of favour with the Swiss franc again losing ground. Precious metals also failed to make headway, especially with European currencies subdued.

The headline UK consumer inflation rate held at 1.9% for March compared with consensus forecasts of a slight increase to 2.0% with the core rate also unchanged at 1.8%. The data continued to dampen expectations that the Bank of England would look to increase interest rates this year. ONS data recorded that house prices increased 0.6% in the year to February, the slowest rate of increase since September 2012. The data overall triggered another round of mild Sterling loss amid a lack of buying interest while volatility remained lower despite some pressure for position adjustment ahead of the Easter break.

There were no substantive political developments which also tended to stifle potential buying interest and a dip in oil prices also hampered support. Sterling remained on the defensive as GBP/USD dipped below the 1.3050 level again while GBP/EUR held around 1.1550, although increased confidence in the global growth outlook provided some net protection.

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