The week that started with investor sentiment ignoring a bail-out plan for the financial sector ended with a GDP figure that sent GBP/USD to its lowest level since September 1986. Had we seen a close at that level it would really have been ‘all bets are off’ as analysts speculate over a move to 1.25 or lower. Luckily sterling was bid up a little before close of play but the trend still is for sterling weakness.

Euro wasn’t able to really take advantage of sterling’s travails on Friday as the problems we envisioned for the Eurozone start to poke through the earth. National debt of certain EU states are being downgraded while one member of the ECB council has acknowledged that any ‘quantative easing’ strategies implemented in the EU will be almost impossible given the make up of the area.

UK data only consists of BBA mortgage data although FX markets will once again be at the behest of equity markets.

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