Welcome to our new weekly Pound report from the Currency Solutions newsletter - providing a day-by-day analysis on the GBP.

Each day the Currency Solutions team review the Pound, Dollar, Euro and other top movers with a daily newsletter sent to your inbox.

To sign up to the Currency Solutions daily newsletter or for more information on their products click here

Monday

The halting of interest rates last week suggested that the BoE are taking a ‘wait and see’ stance on the country’s hesitant economic recovery and this made for a quiet few days. This morning at 1033 GMT the pound traded above the 1.510 level against the dollar at 1.5116 and 1.1084 versus the euro.

Some economists say that a weakening pound is good for Britain at present, not only because it tends to boost economic growth by making British goods and services more competitive on world markets, but also because it will help to rebalance the structure of the economy.

Tuesday

Sterling dipped below USD1.50 this morning, approaching the lowest level against the dollar in 10 months, as data showed a drop in UK house prices. The pound traded at 1.4987 at 0923 GMT.

The Royal Institution of Chartered Surveyors said its monthly house price balance dropped to +17 in February from a downwardly revised +31 in January. The data showed that February's decline was the sharpest one-month fall since April 2008.

Traders have also been unnerved by a ratings agency report on the impact of the eventual reduction of state aid on British banks.

Wednesday

Sterling slid to one-week lows against the dollar and euro today after data showing an unexpected fall in British manufacturing gave the pound another clout as it still remains dazed from political and economic uncertainty.

Data showing British manufacturing output declining 0.9% in January, the sharpest monthly rate since last August pushed the pound to fall over 40 pips against the euro, and 50 pips against the dollar in today's mid-day trading. At 1428 GMT it traded at 1.4956 versus the dollar and 1.0978 against the euro.

Fears about a hung parliament were flagged by political opinion polls yesterday and concerns about Britain's sovereign ratings after a ratings agency highlighted the country's worsening credit profile.

Thursday

Sterling managed a slight recovery from its lows yesterday but many believe this could well be a period of calm between storms as political and fiscal pressures continue to burden UK currency.

 At 0903 GMT, sterling traded close to flat against the dollar at 1.4977 and has since moved down slightly to 1.4961 at the time of writing. Euro/sterling was unchanged in early trading at 91.10 pence, off Wednesday's high of 91.30.

Adding to the negativity was concern over Britain's sovereign ratings after Fitch Ratings highlighted on Tuesday the country's deteriorating credit profile.

On Wednesday Prime Minister Gordon Brown said he believed Britain would maintain its coveted top credit rating also saying that economic recovery remained fragile and to change course now would risk plunging Britain back into recession.

Later today the British Consumer Inflation Expectation Report may cause some ripples in sterling’s waters.

Friday

A poll showed the opposition Conservatives gaining 39% of the vote, with the Labour Party on 26% forecasting an outright majority win for the Tories.
Earlier at 0905 GMT, sterling was up 0.3% against the dollar at USD1.5103 and currently at 0954 GMT trades slightly above that level at USD1.5139.

However, the pound failed to make much of a case against the euro which was steady in early trading and currently sits at EUR1.1012.

Investors are remaining cautious as recent polls have suggested the election could result in a hung parliament, which would potentially hamper any incoming government's efforts to cut the UK's expanding budget deficit.

Remember you can get extra information five days a week also covering the Euro, Dollar and other top currencies by signing up to the Currency Solutions Newsletter. To sign up to the Currency Solutions daily newsletter or for more information on their products click here

Nigel Hodges www.currencysolutions.co.uk