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Monday, July 7, 2008 Afternoon Update - 07/07/08

The FTSE is currently indicating a higher open, as traders are waiting for the release of the UK Industrial and Manufacturing Production numbers. While traders are predicting no change, we believe that this is very optimistic. We believe that both the industrial and manufacturing production numbers actually fell in June. A slow down in the UK production will force the BOE think twice before they raise interest rates again at the next meeting.

Gold was on the weak end of things as the US dollar benefited from better then expected employment numbers. With no major news until later today, we expect gold to continue its retreat, and US dollar to strengthen vs. the major currency pairs. Oil is also weaker this morning, mainly due to the fact that the contracts are priced in US dollars.