Pound Sterling - UK Markets

Sterling is 1% higher against a suffering US Dollar to 1.7369 as US jobless data came in yesterday triggering a fresh wave of panic selling on global equity markets.

The Pound gained 0.86% against the Euro to trade at 1.2894 this morning and gave a mixed performance against its major currency partners, declining against the Australian, Kiwi and Canadian Dollars. 

The FTSE hit a five year low in response to panic selling which began in Wall Street and spread around the globe. UK data was thin on the ground, other than the Bank of England announcing new measures to ensure liquidity and Gordon Brown's reassurance to consumers that lower oil prices should flow through to food and energy figures soon.

UK money supply and retail sales data are due early next week and will be crucial to the perception of recession prospects in the UK.

US Dollar - US Markets

The US Dollar suffered slightly overnight, down against both the Pound and the Euro as the prospect of recession continues to plague equity markets and put the Dollar under pressure.

Jobless data showing 461 000 unemployed this month was slightly better than expected, and better than the previous weeks 477 000. Consumer Price Inflation has also slowed to zero. Although panic selling characterised the day on Wall Street, triggering further declines throughout the world, markets did experience a degree of positive sentiment surrounding the rebounding oil price after the OPEC meeting to cut production. 

There is no major data due from the US until the October 29 Federal Reserve Board Meeting which may give the Dollar time to reach a degree of stability following the recent shocks this week.

Euro - European Markets

The Euro remained resilient in yesterdays trading despite European markets being subject to the same plummeting that began in the US and has been felt around the world. 

Trading at 1.3464 versus the US Dollar the Swiss franc has recovered slightly after suffering a knock to its reputation after UBS and Credit Suisse have been on the receiving end of bank bail outs.

Weaker Dollar and more stable oil prices are expected to ease trading in European markets today and we may see some appreciation in the Euro

EU leaders are to meet today and the EMU trade balance is due