The Dollar fell broadly on Tuesday as geopolitical risk and declining U.S. Treasury yields pushed traders out of the greenback.
The Japanese yen rose broadly, as possible U.S. action in Syria and North Korea, and a resurgence of a previously written-off leftist contender in France's presidential race prompted buying of the safe-haven currency.
The possibility of some kind of U.S. military action against North Korea in response to its weapons tests grew after U.S. missile strikes against Syria last week in retaliation for a chemical weapons attack on civilians.
The Euro also fell against the yen as investors weighed the possibility of a face-off between far-right candidate Marine Le Pen and left-wing candidate Jean-Luc Melenchon, who has surged in polls recently.
Both Le Pen's and Melenchon's pledges to hold referendums on France's membership in the European Union have sparked fears among investors of the potential for a wider breakup of the euro zone.
Sterling was broadly unchanged against the dollar and euro on Tuesday after data showed UK inflation remained steady in March, putting no further pressure on the Bank of England to move towards raising interest rates.
Consumer prices increased by 2.3 percent annually last month, according to the Office for National Statistics. Inflation has accelerated in recent months, pushed up by a plunge of around 12 percent in the trade-weighted value of the pound since last summer's decision by voters to leave the European Union, and by a rise in oil prices that has fuelled inflation in other countries too.
Inflation is now above the BoE's 2 percent target but it has indicated that it is in no hurry to raise rates, despite the fact that it expects consumer price growth will rise to as high as 2.8 percent in around a year's time before falling back.
09:00 – GBP – BOE Governor Carney Speaks at the International Fintech Conference
09:30 – GBP – Average Earnings Index; Forecast at 2.1% against previous of 2.2%
15:30 – USD – Crude Oil Inventories