UK

PM Brown: UK does not set target levels for FX rates, just inflation rates which are falling

UK Nationwide Consumer Confidence

Expected at 54

Prior at 55

Actual at 50

Revised at 56

UK PM Brown: UK faces rapidly declining inflation 

UKs Brown is on the wires saying their is scope for further interest rate cuts in the UK. The GBPUSD went form 1.4730 to below 1.4700 on the comments.  US Retail Sales out in a few minutes. Bernanke is also expected to speak at 8:30 AM EDT.

UK PM Brown: Now is the moment to provide a fiscal stmulus to the economy, in a position to make further fiscal action

The G7 must do more than talk, they need action.

They will discuss financial markets and current developments.  The BOE has their Monetary Policy Committee meeting on Thursday where they are expected to cut rates by 25 basis points. 

Brown spokesman says the meeting is not an emergency meeting. 

The UK CPI rose more than expected to 4.7% from 4.6%.  The MoM measure rost by 0.6%.  The core measure increased by 2.0%, which was the fastest pace since 1997.  The higher inflation is not abating at the time when the economy is in need of a cut.

The yearly Output Core PPI came in higher year over year at 6.7% versus the 6.5% survey and lower month over month at .3% versus the .4% survey.  Other PPI readings included:

• PPI Input (mom) -.6% vs. 1% survey

• PPI Input (mom) - 30.1% vs. 29.8% survey

The Total Trade Balance came in weaker at -4414million pounds versus the -4200m survey. The prior month's data was revised better at -4073m vs. -4248m. The Sterling has had a limited reaction to this data.

UK Rightmove House Price Index

Actual -1.8%

Prior -1.2%

Yoy figure at -2.0% which was the 1st on year price drop since August 2002 when the survey started.  Unsold homes also at record high.