The euro fell yesterday after the ZEW economic expectations index fell again for September.

At the beginning of today one euro was worth £0.67315, $ 1.26775 and 148.46500 yen.

The ZEW index fell 16.6 points in September and now stands at -22.2 points, considerably below the historical average of 37.7 points.

The fall was put down to a drop in world demand following a slowdown in the US economy. Furthermore, an increase in German VAT at the beginning of next year is expected to slowdown domestic consumption.

ZEW president Dr Wolfgang Franz said: "The gap between expectations and the current situation again indicates that the positive business climate is at risk.

"The German government should not ignore these alarm signals and redress the serious imbalances in its economic policy."

The indicator also showed economic expectations in the eurozone are depressed, even though the index for the current economic situation rose.

In the UK, the focus today will be on the minutes from the last meeting of the Bank of England's monetary policy committee and will be studied for hints of any future interest rate rises this year - which would lift sterling.