Investors spooked at the non stop increasing likelihood of a US recession, which grew increasingly nervous today as markets suspect that the $280 billion plan announced by the US Feds earlier this week to ease the credit crisis will fail to stop a full blown slowdown.

Meanwhile, the dollar is having a freefall day with the US currency sinking to record lows against the euro in which mounting concerns that the US economy is heading into a recession allowed the euro to leap at this hour to the $1.5587 level mark.

Though the UK is facing its our problem dealing with the current situation of high inflation with a slowdown in the housing sector, its doing pretty good for any other currency in its shoes inclining above the $2 level mark on the back of a weak dollar. The Royal pound is benefiting from the continuing flow of weak economic US data leading to a weakening sentiment for the US and rising fears of a recession pushing the pound along with the GBP/USD pair to the upside.

The dollar continues to drop heavily against the yen below the $100 Japanese yen for the first time since 1995 supported by the continuing deteriorating of the dollar's sentiment very rapidly which in turn prompted more speculators to begin unwinding their yen carry trade.

Many analysts now expect the Fed will cut its key interest rates by as much as 75 basis points next week. Investors generally prefer the currencies of countries with higher interest rates as they can bring in better yields pushing more dollars selling.