In currencies, Sterling was heavily sold across the board as concerns over UK economic conditions. Some analysts referred to cable as a new funding currency, citing recent depreciation against the high-yielding commodity FX after monetary authorities left the door open for further interest rate cuts.

Bank of England said UK recession would not end for another 6 to 9 months, and return to normal activity would likely take some time. GBP/USD fell nearly one big figure to 1.6299, just as GBP marked fresh 4-weeks lows against EUR and CHF. In commodity FX, risk aversion sank AUD/USD below 0.87 and NZD/USD below 0.71, while USD/JPY traded higher despite the bearish sentiment on overall greenback strength.

Spot Gold prices are little changed. In terms of news related to the gold market, an earlier released unconfirmed report disclosed that the IMF’s executive board may consider the organization’s previously announced gold sales plan later today. According to the report, the IMF is planning to sell about 13M ounces of gold, which equals about 12.5% of its total gold holdings. According to estimates from early 2008, the IMF was the world’s 3rd largest holder of gold with approximately 103M ounces or 3,200 tons.

Today’s report related to the IMF follows the announcement in Aug by the various European central banks that starting in late Sept they would sell a maximum of 2,000 tons of gold over the next 5 years. In other metals, Silver reached 17.30 and is expected to reach further highs.

Crude oil prices are declining and have traded near $71.60, for most of the session. Oil prices are being weighed down by the declines in the Nikkei 225 equity index and the firmer US dollar.