The main focus was the release of the Bank of England minutes from the April policy meeting with six votes in favour of the quarter point cut, one vote for a half point cut and two votes to keep rates unchanged. Elsewhere, all eyes will be focused on the German IFO data and UK retail sales, and a bad reading for both could see the Euro and Sterling sold off again and the dollar make further gains.

Sterling (GBP)

Following the MPC minuets, Andrew Sentance, a Bank of England policymaker stated that while the fall in the pound will aggravate the inflationary impulse coming from higher global energy and commodity prices, at the same time it will provide some demand offset to the negative impact of the credit crunch.

US Dollar (USD)

The dollar gained strength against both the euro and the pound, as investors trimmed positions before the German corporate sentiment data, which is expected to provide more clues on the health of Europe's economy. The dollar's rally may be short lived, however, as investors start to price in a Federal Reserve 25 basis point rate cut next week.

Euro (EUR)

The euro lost ground against the dollar as investors awaited German corporate sentiment data for further clues on the health of the economy in the euro-zone. Weighing on the single currency was soft economic data and comments from policymakers that implied the weaker dollar is beginning to hurt euro-zone economic growth.

Japanese Yen (JPY)

A Reuters poll indicated that the Bank of Japan is likely to keep interest rates on hold for well over a year, as slower US growth holds back Japan's export-driven expansion.