The purchasing managers index was released today in both Germany and the Euro Zone for April, services PMI rose to 54.6 from the prior 51.8 in Germany, while the Euro Zone PMI rose to 51.8 from 51.6 both readings came above median estimates and highlighting the limited effects from the worst financial crisis in the United States since the Great Depression on the 15-nation economy.

While the manufacturing PMI declined below estimates in both Germany and the Euro Zone in April, dropping in Germany to 53.6 from 55.1 and below median estimates, while dropping for the whole Euro Zone to 50.8 from 52.0 the prior month.

The Euro settled in April above the $1.50 mark, yet signs of real constraints over the manufacturing sector were still limited, the ongoing rise should prove to be as a dilemma for the ECB especially as they struggle to fight skyrocketing inflation which rose 3.6 percent in March!

Rising voices from the Euro Zone indicated that a rate cut won't be considered and if any change in rates should occur then it would rather be towards the upside as the ECB have stressed now that their main priority remains rising inflation, which is now receiving more momentum due to the never ending rise in food and energy prices.

Yet the outlook seems reasonably strong for the Euro Zone, the industrial new orders rose in February to 0.6 percent from an upwardly revised 2.2 percent, while compared with a year earlier new orders rose 9.9% from a downside revised 7.1%. The Euro though was trading near the $1.50 mark back in February and the reading doesn't fully reflect the recent rise in the Euro's value.

The BOE released their MPC minutes where they decided to cut interest rates by 25 basis points to 5.00 percent, the vote was rather surprising as the MPC members were split into three groups for the first time in two years, the three-way rate decision was 6 voting for the implemented 25 basis points cut, 2 voted for steady rates, while the remaining one voted for a 50 basis points rate cut!!!

The split in vote was rather incomprehensible by investors in the financial markets, as they were waiting for an un-split decision, the BOE signaled that they are struggling to find the balancing act among downside risks to growth and upside risks to inflation, while their latest plan to help ease the credit freeze that started in the U.K money markets came as a disappointment for markets.

The outlook in the U.K remains uncertain especially after today's split vote, should they continue cutting rates as was expected before or is it just the end for now; all will depend on the developments from the U.K housing market! While the ECB have strong evidence why taming inflation remains the highest priority…