Euro drifts against the dollar Currency markets assumed an attitude of detente following the G20 meeting with only the yen making significant moves in a thin market. The euro fell marginally against the US dollar to $1.3352 after a mildly dovish speech by European Central Bank president Mario Draghi. Mr Draghi said the exchange rate was not a policy target and inflation expectations were "firmly in line." The euro has gained a little over 1.2 per cent against the dollar since the start of 2013. The dollar index, within which the single currency carries a 57.6 per cent weighting, traded flat at 80.6 points as America's Presidents" Day holiday resulted in quiet trading. HSBC made the point that given the current calming of the triple uncertainties of eurozone turmoil, the US fiscal cliff and a Chinese hard landing, it is striking that correlations are still at historically high levels, albeit lower than levels reached in 2012. Goldman Sachs, meanwhile, argued that competitive devaluations might eventually trap currency markets in narrow ranges. It is notable that correlations in Japanese yen crosses remain near record highs with the country's economic objectives increasingly driving much of the market, especially as Japanese domestic investors pivot towards Europe. The yen fell a further 0.3 per cent against the euro to Y125.39 and 0.5 per cent against the dollar to Y93.95. It has now fallen 18.4 per cent against the US currency since November, when elections that would usher in Japan's new prime minister Shinzo Abe were announced. Sterling fell 0.3 per cent against the dollar to $1.5474 and 0.1 per cent against the euro to £0.8623 as data showed that speculative positions in the currency had fallen into shorting territory for the first time in five months. The South African rand fell 0.2 per cent against the dollar to R8.8765 after reports of unrest at an Anglo American Platinum mine in the country reminded markets of last year's unrest in the mining areas.