He insisted the rate rise was agreed unanimously by the 18-strong governing council, but admitted that some members had urged a half percentage point rise, while others had wanted rates to remain unchanged. In addition, Trichet commented that the ECB was not embarking on a series of rate rises. This uncertainty sent the euro sharply lower across the board.

A significant milestone was passed yesterday in Japan as the Nikkei closed above 15,000 for the first time in five years. The stock market rally began in August when economic indicators showed that domestic growth was accelerating and the Bank of Japan signalled that seven years of inflation had come to an end. Although, in a lesson to the ECB, economic expansion in Japan suffered during the nineties as premature interest rate hikes halted nascent recoveries.

The Halifax released its house price index for November, which revealed UK house prices to be 1.2 per cent higher on the month, compared with being flat in October. On the year prices rose 4.5 per cent versus 3.9 per cent in the previous month. The Halifax noted that high levels of employment and good earnings continue to underpin the market. However, the Halifax believes the slowdown in the economy, and the high level of house prices will help to prevent another sustained period of sharply rising property values.

Data releases today are all about quality, not quantity, with November US non-farm payrolls due at 13:30hrs. The expectation is for a strong increase in payrolls, with a figure of 160k being mooted. The unemployment rate is forecast to remain unchanged at 5 per cent.