Euro / dollar exchange rate surges ahead but euro / pound exchange rate just won't budge

 A look at the euro currency pairs shows the shared currency has firmed up considerably since the start of the day. However, there is no luck against an equally buoyant sterling:

The euro dollar exchange rate is 0.73 pct up on Wednesday night's closing rate - EUR-USD is seen at 1.3189.
The euro pound exchange rate is still flat at 0.8502.
The euro Australian dollar exchange rate is 0.85 pct higher at 1.3842.

Note that the above are spot references - be advised that your bank will affix a discretionary spread. Also note that an independent currency provider will guarantee to beat your bank's offer, thus delivering you more currency. More info here.

"Forex traders drove the euro higher on the back of the European Central Bank's monetary policy decision. While the ECB left interest rates unchanged at 0.50%, slightly more optimism from Mario Draghi was enough to send the currency to a 3 week, almost 4 week high," notes Kathy Lien at BK Asset Management.

It is worth noting that Draghi spent a bit more time this month talking about the improvements in economic data and their expectations for stabilisation and a gradual recover in 2013.  

"However he did not rule out the possibility of negative rates and instead made it clear that this option was discussed along with ABS, LTROs, collateral and credit claims.  Therefore the main takeaway from the ECB today is that all options are still open but their expectations for stabilisation reduces the chance for additional stimulus," says Lien.

Lien says that while the ECB is keeping monetary policy easy and all of their options open, "their brighter outlook means they aren't poised to pull the trigger on additional stimulus anytime soon which was enough for FX traders to buy euros."

GBP’s current level "is quite ideal"

Meanwhile, the British pound is also enjoying a positive day on the markets owing to the momentum built up after a week of positive data releases.

As we say goodbye to Mervyn King we ask - where would Mark Carney like to see the British pound?

According to Stephen Gallo at BMO Capital Markets the UK currency is in fact at a good valuation:

"We believe that the GBP’s current level is quite ideal for the Bank (i.e. below average but still above its post-ERM lows in nominal effective terms) and also serves as an indication of “neutrality” for the time being.

"The MPC is likely to be in “caretaker mode” at present given the impending handover of authority and, in that vein, given the fact that excessively weak or strong levels of the GBP could potentially make that transition less smooth. Along these lines, recent dataflow and the Bank’s fair bit of dependence on the outcomes from FLS argue for a GBP level that is neither overly reflationary nor overly deflationary at this stage."