Economists had predicted a 0.2% rise in Britain's manufacturing sector in the month of May, but were unpleasantly surprised by the numbers posted. Production at factories across the country recorded a drop of 0.6% in the month, the first time a downturn has taken place in three months.

Recognition that recovery for the UK economy will be long and gruesome is becoming more apparent. The British Chambers of Commerce believe that the path out of recession will be fragile and have cautioned against complacency. The manufacturing figures are still better than at the turn of the year, but unless new orders begin to show convincing improvement, optimism could quickly take a turn for the worse.

The poor reports have sterling exchange rates down almost one cent against the dollar at USD1.62 and the pound has fallen 18% in the past 12 months against the greenback.

The rates quoted above are interbank rates. Client rates may vary according to the volume and timing of the trade.