As expected the B of E cut rates by 25bp and the ECB kept rates unchanged. The Euro and other currencies were well bid ahead of the CB decisions but very soon after some heavy profit taking hit the markets as position squaring kicked in ahead of today's G7 meeting in Washington and very reliable reports that the BIS was prepared to sell Euro/Usd at the $1.5900 level. Unfortunately many of our fresh positions immediately reversed and look to confirm those reversals at today's fixing. The importance of trading the T/R breaks under present market conditions was clearly shown and we must never get 'married' to a position.

Trichet also helped trigger the Euro sell off as at the post ECB press conference he said the 'recent volatility in foreign exchange markets is excessive and is to be deplored'. So tricky times at present and maybe a watching brief is required for a while.