We are waiting today for the MPC interest rate decision. The recent meeting minutes release have shown that The last decision of adding further 50b Stg to the BOE  previous stimulation quantitive easing plan to make the gross of it 175b decision was not unanimously and the market has been shocked by 3 members of the MPC voting for adding 75B Stg instead of just 50B Stg and one of those three was Marvin king himself. These opposing members have referred to the possibility of public confidence damage in the recovery which can flatter it suggesting that the inflation could be under the BOE target for a sustained period. The British pound was under pressure since the release of these dovish minutes and it could not get over 1.665 versus the greenback or even join the single currency pace of progress versus the greenback. So it looks that the market is smoothed today for further adding 25b Stg and if we are to have a greater ample of injected liquidity decision, the British pound can find further difficulties today.

Recently, we have seen that July UK PSNB have shown an unexpected increasing of the public net borrowing by 8 Bln Stg as the market was waiting for just 200 M which dampens the current national debit situation putting pressure on the British pound which was already undermined this week by the release of UK retail sales of August which came down yearly by .1% after rising in July by 1.8% but in spite of the dovish data the British found has found some support recently from the improving of the market risk appetite versus the greenback.

The greenback has been under pressure in the recent few days starting the week in a defensive position because of the equities market gains and the demand for the higher yielding currencies for taking risk after better than expected economic data from US referring to a diminishing of the recession pressure and the increasing of the inflation outlook which can come accompanied with the recovery which could help the gold to get above 1000$ this week. The equity market is still facing resistance in pushing up the stocks further in spite of the current optimism which contain the market sentiment and Dow is still trying to climb up hardly above 9600 after failing to break it as the investors are still in need to believe in this recovery sustainability after pushing Dow up from below 6600 in the 9th of March to the current levels.

The single currency which was trading in a narrow range in the recent weeks capping by the  resistance at 1.44 which has been finally broken this week triggering stop losing orders pushing it above 1.45 versus the greenback. The market was waiting last week to have a hawkish tone in Trichet's speech after the ECB interest rate decision of keeping the interest rate unchanged at 1% but he has expressed his Prudence and caution but the market is looking not patience as him pushing the single currency up across the broad believing in the recovery in EU which can trigger tightening measures later this year by the ECB or at least a staving of its current easing steps for providing liquidity exposing the EUR.

Best wishes