There was little in the way of truly significant data released, therefore trade across the exchanges remained locked in recent ranges. Broadly speaking, financial markets remain largely depressed in all of the major industrialised nations, undermined by rising inflation and slowing growth.

Sterling (GBP)

The sterling begins the session slightly down against both the euro and the US dollar following reports that the British government is about to rewrite its own rules on how much it can borrow in order to counter the effects of the economic slowdown. The new framework would permit more borrowing as an alternative to increasing taxes.

US Dollar (USD)

The dollar could end the week up against the euro, rebounding from a record low on signs US investment banks will withstand credit-market losses arising from the nation's subprime mortgage collapse. The US currency also rose versus the pound on speculation the UK government will boost borrowing. The greenback's initial gains came after JPMorgan's Q2 earnings report came in ahead of market expectations while a drop in oil prices gave the dollar an opportunity to consolidate.

Euro (EUR)

According to Jean-Claude Trichet, growth in the 15 member eurozone is likely to stall during Q2 and Q3 before returning to moderate growth by the end of this year. Mr Trichet also went on to reiterate his commitment to controlling inflation, pointing out that while policy makers can't change the price of oil, they can limit the inflationary impact of the price of services or wage increases.

Japanese Yen (JPY)

Bank of Japan governor, Masaaki Shirakawa, stated that the central bank is putting equal emphasis on both inflation and downside risks to growth, cementing the view that Japanese interest rates are likely to stay on hold for the time being.