NEW YORK ( BBH) -- The U.S. dollar maintained an easier tone with narrow ranges across the majority of the majors, with the Scandi's the biggest movers on the day vs. the dollar. The euro continued to extend its recent gains, up 11 of the last 12 trading days, to trade at $1.372 highs.

Cable, on the other hand, is recovering most of Tuesday's losses trading up to the $1.589 area, after the Bank of England MPC minutes revealed a 7-2 vote for a steady hand. The yen, meanwhile, is flirting with the 82.00 yen level again vs. the dollar as Tuesday's move in Treasury yields weighed on sentiment.

The dollar bloc remains muted, with the New Zealand dollar weakening vs. the dollar ahead of the RBNZ meeting at which the RBNZ is likely to remain on hold followed by a potentially dovish statement.

Global bonds were mostly lower on a rally in stocks, with gilts underperforming after the BOE's minutes. In Europe, the successful EFSF bond auction Tuesday had little carryover Wednesday as peripheral spreads continued to widen amid surveys predicting a eurozone breakup, while the pressure is building on the short end of the curve as well.

Both 10- and two-year yields were up on periphery debt with Ireland's leading the way increasing by 10 basis points, while the Portuguese 10-year increased 15 basis points.

Elsewhere in Europe, the European Central Bank allotted €71.1 billion in three-month repos at a fixed rate of 1%, while bunds sold off (although at a slower pace than the periphery) after German December import price inflation accelerated to 12% year over year, highest in 29 years. As such, the German two-year yield reached a one-year high.
This commentary comes from an independent investor or market observer as part of TheStreet guest contributor program. The views expressed are those of the author and do not necessarily represent the views of TheStreet or its management.