Speculation about rising interest rates in a number of countries has boosted the euro currency market and helped keep the British pound above the $2 mark.

In the past 24 hours, the pound sterling fell 0.4 per cent to $2.0005 from its 26-year record of $2.0133 seen earlier this week. Britain's currency dropped 0.6 per cent to 236.06 yen while the euro rose to 67.91p.

The dollar was steady against the yen this morning at 118.64 while the euro was valued at $1.3619.

"We saw a bit of a sterling/yen decline this morning based on the general yen strength after the China equity sell off overnight," Adrian Schmidt, currency strategist at RBS, told Reuters.

He added that February retail sales could be strong which would help the sterling move up again in the near future.

According to the Associated Press, interest rate rises by the European Central Bank, coupled with healthy European growth have boosted the euro to its current level.

Analysts on the continent are now forecasting the euro to reach a record high when economic statistics are released in both Europe and the US.