Sterling was the largest mover on major currency markets last week which was primarily driven by the latest in a batch of more promising indications on Britain’s economic prospects ahead of elections this coming May.

In Europe, all eyes are focused on Greece and the associated risks to the euro while the yen steadily maintained a leap driven by the Bank of Japan’s confirmation that it did not see the necessity to print more money to jumpstart its economy.

Average wage growth, for long is largely the missing ingredient in Britain’s economic recovery, soaring to 2.1 % in December which limit inflation that fell 0.3 % last month and driving sterling nearly 1 % higher to 73.64 pence per euro.

Generally, the argument in favour of the pound which is now trading at a 6-year high against a basket of currencies in which the U.K. will prove a more secured bet than its peers in Europe in the coming years, with better growth and higher bond yields.

The data this week was quite positive and will most likely offset some of the concerns around the threat of deflation to the U.K. economy. It was seen as a big boost for the pound. $1.54 was taken out and another $1.55 is the next natural barrier, a level which could well be breached after the FOMC meeting later this week.

Experts from custodian back BNY Mellon argued that the pound appears to be increasingly becoming a safer haven of choice for pension and investment managers are apprehensive by the collapse of returns on government bond yields in Germany and several other Eurozone leaders.

Albeit political uncertainty that has been the nuisance of sterling’s performance on numerous occasions and in the face of economic fundamentals that have still to provide a solid case for policy normalisation by the Bank of England.

It is once again playing a pivotal role of a safe haven wherein the pound rose to half a percent to $1.5434.

Price action elsewhere was limited but the yen did not blip higher following the BoJ decision to keep policy stable.

Accordingly, there is no immediate need to expand monetary stimulus again with inflation heading up towards the 3 % target, though the BoJ will not hesitate should the inflation outlook change.

As with the euro, a period of relative steadiness for the yen has raised some questions over how fast even for the U.S.’ better economic performance will move further gains for the dollar following a surge since the middle of the year.

The euro fell by almost a third per cent to $1.1374 along with the yen which traded broadly flat at 119.29 yen per dollar correspondingly.

It appears that there is going to be a tumble between roughly 117-120 yen for a while and the moment it will appear that it will push on through 120, some commentaries will come out as what had happened last week to dampen things according to a spot dealer at the international bank in London.

Finally, the Japanese government is clearly approving a weaker yen, but it has all been a bit too quick for the economy to change and adapt.