Against April forecasts of 2.8% and 2.0% respectively

Unemployment falling from 7% in 2011 to 6.7% in 2012, vs 6.9% and 6.5%. Inflation at 2.3% in 2011 , 1.8% in 2012, vs 2.4% and 2%

Sees ECB cutting rates to 1% over lower inflation expectations and recession. Increased uncertainty will dampen domestic consumption and exports will no longer contribute to expansion

EUR/USD’s around 1.3750 after a recent low of 1.3732