In the UK, borrowing in the public sector was slightly less in December even though it hit a record high for the year to date.

The Office for National Statistics said yesterday that the public sector posted a net cash requirement of 23.60 billion pounds last month.

The rate of borrowing to businesses rose in November and this is the first increase since January 2009.Bank of England data also showed on Thursday, indicating credit conditions may be starting to stabilise.

Lending was down 7.6 percent on the year however, matching October’s reading which was the biggest annual fall since records began in 1999 and data from major UK lenders in the UK also showed that net lending actually weakened in December.

In the Eurozone, preliminary manufacturing PMI for January increased from 51.6 in December to 52.0. This is in line with market forecasts.

A result over 50 is considered positive for the sector while a result under 50 is considered negative.

In the US, new orders and business indexes have continued growing but at a slower pace at a slower pace than in December.

The World Bank said in its latest economic statement that the global economy would be likely to remain in recession throughout 2010 and predicted that global growth would be around 2.7%. According to the IMF , any global growth under 3% is equivalent to a recession.

The World Bank also stated that a 2.2% drop in global GDP, which is the rate of growth this year, would not be sufficient to cut the gap in output which has arisen because of the global recession.

Yesterdays exchange rates

GBP/EUR 1.1482 – 1.1551

GBP/USD 1.6127 – 1.6309

EUR/USD 1.4030 – 1.4135

This morning’s rates

GBP/EUR 1.1501

GBP/USD 1.6253

EUR/USD 1.4131

Economic releases

UK      : 09.30 Retail Sales (December)

EU-16 : 10.00 Industrial Orders (November)