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The pound, which closed yesterday`s trading at 0.8036 against the euro slipped to 0.8053 at 5:15 am ET. This set a new multi-day low for the pound.

Italian trade with non-EU nations showed a deficit of EUR1.21 billion in March, larger than the EUR877 million deficit registered in the previous year, the statistical office ISTAT said today. Exports grew 0.8% from the previous year to EUR12.94 billion from EUR12.84 billion in March 2007. Meanwhile, imports grew at a faster pace of 3.2% to EUR14.16 billion.

The pound is now worth 2.0056 against the franc and 205.21 versus the yen, strengthened from 5-day lows of 1.9931 and 203.42 hit respectively earlier today. The pound-franc pair closed yesterday`s trading at 1.9985 and the pound-yen pair at 204.55.

Switzerland`s trade surplus stood at CHF1.25 billion in March, beating market forecast of CHF0.70 billion surplus, a report from the Federal Customs Administration showed today. Exports rose 6.7% year-on-year in real terms, while imports grew 4.7%. Switzerland recorded a trade surplus of CHF3.8 billion for the first quarter of 2008.

At about 6:30 am ET, the pound-dollar pair reached 1.9871, moving up from a 5-day low of 1.9748 hit at 2:45 am ET. The pair was worth 1.9805 at Monday`s North American close.

The euro rose to 1.5885 against the dollar at about 4:05 am ET Monday. Currently, the pair is trading at 1.5855, compared to last week`s close of 1.5809.

Against the franc, the European currency weakened during today`s early deals. At about 4:05 am ET, euro touched 1.6045 against the franc, compared to Friday`s New York session close of 1.6104.

Data released by the Swiss Federal Statistical Office showed that the overall index of producer and import prices rose 3.9% year-on-year in March. Economists had expected the rate to ease to 3.5% from 3.6% recorded in February. On a monthly basis, the producer and import price index increased 0.6% to reach 109.9 points.

The euro climbed to a 4-day high against the pound due to across the board weakening of the latter. By about 5:30 am ET, the euro fetched 0.8001 against the sterling , compared to Friday`s close of 0.7917.

UK banking system received a lending boost from the central bank today. The Bank of England, or BoE launched the much-hyped GBP50 billion Special Liquidity Scheme to allow banks to swap temporarily their high quality mortgage-backed and other securities for UK Treasury Bills.

According to Mervyn King, Governor of the Bank of England, “The Bank of England`s Special Liquidity Scheme is designed to improve the liquidity position of the banking system and raise confidence in financial markets while ensuring that the risk of losses on the loans they have made remains with the banks.”

A report from Rightmove released today stated that U.K. housing prices have fallen yet again in the month of April. The report says that prices fell by 0.1% from March.

The European currency dropped to 164.06 against the yen at about 4:00 am ET. As of now, the euro-yen pair is trading at 164.27, compared to 164.01 hit late Friday in New York.

Japan`s Ministry of Finance downwardly revised its regional economic assessment for the first time in more than six years. The Ministry added that economic conditions worsened in five of the eleven regions across Japan during January to March period.

The Office for National Statistics, or ONS, revealed today that UK`s claimant count rate stood at 2.5% in March, same as in February. The rate came in line with economists` expectations.

The pound that closed yesterday`s deals at 0.8004 against the euro strengthened to 0.8027 before reversing direction at about 3:10 am ET. The euro-pound pair reached 0.8078 at about 6:25 am ET. This set a fresh record low for the sterling.

Latest data released from Eurostat showed that the euro zone annual inflation accelerated to 3.6% in March, revised up from 3.5% estimated earlier. Annual inflation increased from 3.3% recorded in February. Monthly inflation stood at 1% in March.

Annual inflation continued to stay well above the central bank target. The central bank aims to keep inflation rates “below, but close to, 2% over the medium term”. This made euro to hit fresh record high against the dollar too.

Italian total trade deficit narrowed to EUR408 million in February from EUR1.86 billion registered in the previous year. In January, trade deficit accounted for EUR4.21 billion. Value of exports rose 10.9% year-on-year in February and that of imports climbed 5.3%.

The British pound advanced to a 2-day high of 200.81 against the Japanese yen by about 2:25 am ET. Loosing ground thereafter, the pound is currently trading at 199.44 against the yen, compared to yesterday`s close of 199.88.

The UK`s sterling ticked down against the franc after hitting a 2-day high of 1.9829 by about 3:10 am ET. The pound-franc pair that closed yesterday`s trading at 1.9759 is currently worth 1.9711.

The British currency gained ground against the US dollar after hitting a 26-day low of 1.9603 at about 6:20 pm ET Tuesday. The pound thus climbed to 2-day high of 1.9809 against the dollar at about 5:45 am ET. The pound-dollar pair closed yesterday`s deals at 1.9628.

The US March Consumer Price Index data is expected at 8:30 am ET today. Analysts expect the consumer price index to increase 0.3%, compared with February`s flat rate. Core CPI, which excludes food and energy prices, is expected to increase 0.2% from February`s flat rate.

On the other hand, the single currency gave back its Asian session gains versus the franc and the yen. The euro thus fell from 4-day highs against its Swiss and Japanese counterparts.

German economic sentiment dropped 8.7 points to minus 40.7 in April, a monthly survey by the Center for European Economic Research, or ZEW, indicated today. Economists were looking for a reading of minus 30. The indicator stayed well below its historical average of 30 points.

In addition, Italian annual inflation remained stable at 3.3% in March. On a monthly basis, the Consumer Price Index, or CPI, rose 0.5%, at the same pace registered in the prior month. Both figures matched economists` expectations.

Meanwhile, French annual inflation accelerated to 3.2% in March, the statistical office INSEE indicated Tuesday. Economists had expected an increase of just 3%. On a monthly basis, consumer prices were up 0.8%, higher than the 0.6% expected by analysts.

Against the British pound, the single currency rose to a fresh record high of 0.8067 at about 4.30 am ET, compared to 0.8004 hit late New York Monday. Currently, the pair is trading at 0.8045.

UK`s annual house price inflation slowed to 6.7% in February from 8% in January, the Department of Communities and Local Government, or DCLG, reported today. Economists had expected the rate to ease to 7.4%.

The Office for National Statistics revealed today that the UK annual inflation stood at 2.5% in March, same as in February. Economists had expected inflation to rise to 2.6%. Annual inflation continued to stay above the central bank`s target of 2%.

The Royal Institution of Chartered Surveyors (RICS) that the number of chartered surveyors reporting house price declines in March hit its highest level since the survey began in 1978. RICS said 78.5 percent more of its members reported price declines rather than increases for the three months to March. It was the eighth consecutive decrease. Most economists were predicting a less-severe decline.

The European currency showed strength against the US dollar in early deals today. At about 4.45 am Eastern Time, the euro-dollar pair hit a high of 1.5876 compared to Monday`s North American session close of 1.5833. Currently, the pair is trading near 1.5834.

The European Central Bank President Jean-Claude Trichet said yesterday that the policy makers must remain alert to ongoing developments in the global credit crisis. “It is not a time for complacency in any respect, Trichet said in a speech Monday at an economic forum at the New York University Law School.

Trichet emphasized the need for global coordinated action, welcoming recommendations from the Group of Seven nations over the weekend that called for greater transparency and more pro-active regulatory oversight. He noted that despite increasing evidence that the European economy was slowing, inflation remains a growing threat.

The euro advanced to a 4-day high of 1.5847 versus the Swiss franc dollar before reversing direction by about 10.15 pm ET. The pair that closed Monday`s deals at 1.5814 is now worth 1.5812.

Against the Japanese yen, the euro gained in Asian session but pared the gains in early European deals. At about 5.00 am Eastern Time, the euro-yen pair reached 159.72, falling from a 4-day high of 160.54. The pair that closed yesterday`s deals at 160.07 is now quoted at 159.88.

The effects of the subprime crisis have been felt around the world, but its impact has been smaller in Japan than in other countries, Japanese Finance Minister Fukushiro Nukaga told reporters in a regularly scheduled briefing following Tuesday`s cabinet meeting. He did concede that oil and other downside economic factors continue to pose risks for Japan.

Meanwhile, the Bank of Japan Governor Masaaki Shirakawa said that the central bank`s top priority is to prevent financial market confusion as well as to ensure stability.

The UK PPI and the Euro-zone industrial production reports, which were released during the European session, likely influenced trading.

UK output prices for home sales of manufactured products rose 6.2% from the previous year in March, the Office for National Statistics said today. Output prices climbed more than February`s 5.9% growth and 5.6% expected by analysts. On a monthly basis, output prices climbed at a faster pace of 0.9% compared with 0.5% in the prior month.

Meanwhile, input price inflation accelerated to 20.6% annually from 19.7% in February. Compared to prior month, input prices climbed 2.9%, up from 1.5% in February.

The pound lost ground against the euro after hitting a 6-day high of 0.7966 at 12:40 am ET Monday. The pound dropped to 0.8012 by about 3:55 am ET, compared to Friday`s closing value of 0.8032.

Euro zone industrial output grew 0.3% month-on-month in February, the Eurostat indicated today. Economists expected just 0.2% monthly growth in February. On an annual basis, industrial production increased 3.1% compared with 3.3% in January. However, industrial output rose more than 2.9% expected by economists.

Additionally, France`s business sentiment dropped to 105 in March from 106 recorded in February, a survey from the Bank of France revealed Monday. Economists were looking for a reading of 106 for March. The bank maintained its GDP growth estimate for the first quarter at 0.4%. The report added that growth carried over for 2008 should stand at 1.2% at the end of the first quarter.

The pound fetched 1.9767 against the dollar at 4:20 am ET Monday, up from last week`s close of 1.9721.

At about 3:55 am ET, the pound touched a low of 198.16 versus the yen. Thereafter, the pair bounced back and reached 199.56 in about couple hours. The pair was worth 199.02 at Friday`s close.

While uncertainty over the state of the global economy remains high, the Bank of Japan`s policy board agreed that its basic thinking on monetary policy remained unchanged, according to the minutes from the central bank`s March 6 and 7 policy meeting that were made public today morning.

The members of the board of governors felt they must be flexible in their policy response, the minutes also showed, but that careful study of the upside and downside risks to the economy were required.

Against the Swiss currency, the pound largely bounced between 1.9779 and 1.9828 in today`s early Asian deals. However, at about 1:45 am ET, the pair moved off the range and touched a low of 1.9713 by about 3:55 am ET. The pair then reversed direction it is now trading at 1.9780. The pound-franc pair closed last week`s deals 1.9723.

The UK PPI and the Euro-zone industrial production reports, which were released during the European session, likely influenced trading.

UK output prices for home sales of manufactured products rose 6.2% from the previous year in March, the Office for National Statistics said today. Output prices climbed more than February`s 5.9% growth and 5.6% expected by analysts. On a monthly basis, output prices climbed at a faster pace of 0.9% compared with 0.5% in the prior month.

Meanwhile, input price inflation accelerated to 20.6% annually from 19.7% in February. Compared to prior month, input prices climbed 2.9%, up from 1.5% in February.

The pound lost ground against the euro after hitting a 6-day high of 0.7966 at 12:40 am ET Monday. The pound dropped to 0.8012 by about 3:55 am ET, compared to Friday`s closing value of 0.8032.

Euro zone industrial output grew 0.3% month-on-month in February, the Eurostat indicated today. Economists expected just 0.2% monthly growth in February. On an annual basis, industrial production increased 3.1% compared with 3.3% in January. However, industrial output rose more than 2.9% expected by economists.

Additionally, France`s business sentiment dropped to 105 in March from 106 recorded in February, a survey from the Bank of France revealed Monday. Economists were looking for a reading of 106 for March. The bank maintained its GDP growth estimate for the first quarter at 0.4%. The report added that growth carried over for 2008 should stand at 1.2% at the end of the first quarter.

The pound fetched 1.9767 against the dollar at 4:20 am ET Monday, up from last week`s close of 1.9721.

At about 3:55 am ET, the pound touched a low of 198.16 versus the yen. Thereafter, the pair bounced back and reached 199.56 in about couple hours. The pair was worth 199.02 at Friday`s close.

While uncertainty over the state of the global economy remains high, the Bank of Japan`s policy board agreed that its basic thinking on monetary policy remained unchanged, according to the minutes from the central bank`s March 6 and 7 policy meeting that were made public today morning.

The members of the board of governors felt they must be flexible in their policy response, the minutes also showed, but that careful study of the upside and downside risks to the economy were required.

Against the Swiss currency, the pound largely bounced between 1.9779 and 1.9828 in today`s early Asian deals. However, at about 1:45 am ET, the pair moved off the range and touched a low of 1.9713 by about 3:55 am ET. The pair then reversed direction it is now trading at 1.9780. The pound-franc pair closed last week`s deals 1.9723.

The British producer price index and the Euro-zone industrial production reports are expected during the upcoming hours.

The pound that closed Friday`s trading at 0.8032 against the euro climbed to 0.7966 by about 12:40 am ET Monday. This set a 6-day high for the pound. The pound then weakened slightly and the pair is now worth 0.7994.

The pound fetched 1.9746 against the dollar at 2:30 am ET Monday, up from last week`s close of 1.9721.

At about 2:55 am ET, the pound touched a low of 198.49 versus the yen, compared to 199.02 hit late Friday in New York.

While uncertainty over the state of the global economy remains high, the Bank of Japan`s policy board agreed that its basic thinking on monetary policy remained unchanged, according to the minutes from the central bank`s March 6 and 7 policy meeting that were made public today morning.

The members of the board of governors felt they must be flexible in their policy response, the minutes also showed, but that careful study of the upside and downside risks to the economy were required.

Against the Swiss currency, the pound largely bounced between 1.9779 and 1.9828 in today`s early Asian deals. However, at about 1:45 am ET, the pair moved off the range and it is now trading at 1.9740. The pound-franc pair was worth 1.9723 at last week`s close.