Sterling strengthened yesterday after stronger than expected retail sales figures provided some rare positive news on the UK economy. Figures showed that retail sales increased by 0.6% in October – beating expectations for a fall. Despite this rare piece of good news, many analysts feel there are still significant risks facing the UK economy – especially heading into the new year when growth can stall after Christmas. Sterling should however remain supported against the euro given the concerns over risks of contagion in the euro zone. Elsewhere this week, inflation fell and the number of new people claiming unemployment benefits fell significantly on last month. Call in now for a live exchange rate.

In the euro zone, it appeared that the European debt crisis was close to claiming its 3rd victim in as many weeks. Spain’s borrowing costs jumped yesterday, with the country having to pay 6.975% on new borrowing yesterday 3 days ahead of an election that is expected to see the ruling socialist party toppled. Bond yields in many other countries in the region also suffered with many analysts predicting that markets are now pricing in a break up of the euro zone. Call in now for a live rate as there is significant volatility.

In the USA, stock markets fell for another day on Thursday as fears over the euro zone crisis causing a global liquidity crisis negated recent positive data showing a 7 month low for new jobless claims and an increase in permits for new homes. Many had felt that these positive signs were a sign that the US recovery was under way, but the gathering storm in Europe is a worrying sign for the global recovery. Ensure you take advantage of any volatility and speak to one of the traders today.

Elsewhere, the Japanese yen strengthened to a 2 ½ week high against the US dollar as concern over the euro zone saw investors seek refuge in the safe haven currency. This was the lowest level since the Japanese intervention of October 31st. Markets are very jittery at the moment in relation to the euro zone, so call in now to ensure you don’t lose out.

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