Better than expected business confidence data from Germany has held up the euro.

The euro started the day up against sterling and the yen at £0.67745 and 149.54500 yen and steady with the dollar at $1.27655.

The euro's strengthening came as the Ifo Business Climate Index for German industry and trade fell slightly but remained at the high level from the first half of the year.

The report stated: "The surveyed firms gave the same positive assessments of their current business situation as last month. The German economic recovery remains robust."

Earlier this week, the euro had fallen off the back of a weak ZEW business and investor sentiment survey.

Yesterday, the office for National Statistics released data showing UK GDP rose by 0.8 per cent in the second quarter of 2006. Growth came mainly from services.

In the three months to May, UK manufacturing reported increased output of 0.7 per cent.