The Euro slumped against the Dollar, after the release of French PMI revealed that the second biggest economy in the Euro Zone is suffering a contraction in the manufacturing and the services sectors. The Euro traded at 1.5585 against the Dollar at 7:00am GMT. 'The fact that it's in contraction territory is a concern. The reality for most of the Euro Zone is that the economy outside the Germany is very weak', said Daragh Maher, senior currency strategist at Calyon.

The British Pound dropped against the Euro and the Dollar on the early trading, after UK housing prices were revealed yesterday at -1.5 percent, the highest drop this year. The Pound traded at 1.9677 against the Dollar and at 0.7904 against the Euro at 7:00am GMT. The UK currency, historically one of the strongest currencies in the world is losing value as the British economy is showing signs of recession, due to the spreading US credit crisis.

The Aussie is appreciating against the US Dollar, supported by a Government's report that showed the Australian Trade Balance is improving; exports are expected to increase in 40 percent between 2008/2009. The Australian Dollar traded at 0.9548 against the US currency at 7:00am GMT. In opposition, the Fed is expected to keep borrowing costs on hold, after it had signal a possible rise in the beginning of the month.

The New Zealand Dollar fell on the early trading, after the Bank of New Zealand revealed the economy contracted in the first quarter; the kiwi traded at 0.7622 against the US Dollar at 7:00am GMT. Speculation that the Reserve Bank of New Zealand will be forced to cut interest rates, in order to boost economic development is pushing the nation's currency down.

In a poor day in terms of economic data, investors were paying attention to the release of economic indicators in the Euro Zone at 9:00am GMT. The European strongest economy, Germany, revealed some negative data concerning Manufacturing PMI and Business Climate; the Euro dropped to 1.5520 as soon as the data was released.

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