Prior to the Bank of England meeting last week, Sterling was enjoying a bright, warm and sunny summer. Since then, Sterling has been blighted as the BoE dampened anticipation of a move towards an interest rate rise in the UK. Sterling did recover slightly yesterday, bouncing up from a one month low against the Euro as UK House prices reported a rise to +44 in July from +40 in June.

It is the Euro then basking in the sunshine as it looks to end this week with it’s biggest gains for sometime after China devalued the Yuan and Greece edges closer to securing a bailout.

In Greece, lawmakers are currently voting on legislation this morning to unlock as much as €86bn of aid, before a €3.2bn payment is due to the European Central Bank on August 20th. While in China, reassurances from Chinese officials that they’ll limit excessive volatility have eased investors concerns. China has set the Yuan’s reference rate at 6.3975 per US Dollar, raising it for the first time since Tuesday’s devaluation.

All this has seen the Euro climb against all 16 major currencies (except the Swedish Krona); in fact, the Euro has risen 1.6% this week, its biggest move since May.

For today’s data, the German preliminary GDP reading this morning fell short of expectations, but has not troubled the Euro. Later in the day we have Manufacturing Sales from Canada, and also more data from the USA to guide the market on the “will they /won’t they” put up interest rate scenario. At 1.30pm is the US Producer Price Index, and at 3.00pm the preliminary reading on Consumer Sentiment from the University of Michigan.