This morning the euro was at 1.4279 to the pound, while the dollar was at 1.7573 against sterling.

The Bank of England is being widely tipped to keep the benchmark interest rate on hold at 4.5 per cent, but analysts will be keen to see the fallout from the latest decision.

The monetary policy committee (MPC) is to determine whether rates should stay on hold for what would be the eighth consecutive month.

Economists surveyed by both Bloomberg and Reuters indicate the MPC will hold borrowing costs at 4.5 per cent.

However, there is still an expectation in some quarters that problems in British manufacturing and also a dip in public service sector activity will lead to rates being cut by the summer.

The Office for National Statistics announced earlier that UK manufacturing output was down 0.2 per cent in February, further underlining the problems in the industry.