• U.K.’s sovereign credit rating is most at risk among top-rated nations – Fitch.
  • German Oct final CPI +0.1% m/m, flat y/y, as expected. HICP +0.1% m/m, -0.1% y/y
  • Shanghai share index ends up +0.1%, rises for eigth straight session
  • Russia central bank shifts intervention level to 35.15 rbls/basket from 35.20 after buying $700 mln
  • French September industry output -1.5% m/m, weaker than median forecast of +0.5%. August data however revised higher, t0 +2.8% m/m from initial +1.8%
  • Dutch FinMin Wouter Bos: “We always wanted a strong euro. And now we have one. We should not complain.”
  • Italy September industrial output -5.3% m/m, weaker than median forecast -4.0%, steepest drop since start of series in 1990. However Q3 output +4.0% q/q vs -3.3% in Q2, first quarterly rise since Q1 2008
  • UK September visible trade deficit -£7.194 bln, worse than median forecast -£6.1 bln. Non-EU -£3.783 bln, worse than median forecast of -£3.0 bln
  • UK September DCLG house price data -4.1% y/y, better than median forecast -4.9% y/y
  • ZEW November German economic sentiment indicator 51.1 vs 56.0 in October, worse than median forecast of 55.0
  • UK Brown: UK has reassured people with deficit reduction plan

Cable and sterling in general have spent the morning slowly recovering from the sharp overnight sell-off, which was induced by Fitch’s David Riley warning that UK is most at risk among major economies of losing its AAA sovereign debt rating (see above.)

Cable having been as low as 1.6602 is back up around 1.6700, while EUR/GBP is back down at .8980 having been as high as .9017.

Good old Gordon Brown came out to lend a hand, telling reporters at usual press conference that UK has reassured people with its deficit reduction plan (see above) Bless.

EUR/USD marginally firmer, but ostensibly rangebound. The parameters are 1.4950-1.5020. While the market remains ostensibly bullish the pairing, there is evident caution of running into China sell interest up at 1.5020/30.

The pairing dipped briefly to 1.4975 from 1.4995 in the wake of disappointing ZEW data, but it bounced back quickly, underlining underlying (easy for you to say) sentiment. Both Cititechs and Deutche fancy it higher, both recommending long possies in the pairing.

USD/JPY is marginally firmer, presently at 90.10 from an early 89.85. Sovereign buying of the EUR/JPY cross, presently at 135.15 from an early 134.50, has helped underpin USD/JPY.