After its hour in the sun during last Thursday's European Central Bank press conference the euro rather faded into the background. Friday's provisional purchasing managers' index readings from Germany and pan-Euroland were mostly better than forecast and IFO's survey of German companies found them more upbeat than expected. The same went for the EC's own confidence measures, which were all unchanged or better on the month. None made much difference to the currency.

Against the US dollar the euro was helped by a lukewarm policy statement from the Federal Reserve, which displayed no urgency for higher interest rates. Sterling was held back by weak provisional PMIs, which pointed to shrinkage across the UK private sector and contributed to a growing sense that the Monetary Policy Committee will take sterling interest rates lower in August. The euro added half a cent on the week and strengthened by a cent against the pound.