Over the last two to three weeks Europe has been going through a torrid time which has seen many ups and downs with many educated people asking the question, is this the end of the euro as we know it or is there a need for major reforms to it? For example, the recent range of the Pound and Euro over these uncertain weeks had been just over 1.13 to levels just over 1.17.

This of course was due in part to the recent Greek situation which had some people running for the hills as Mr George Papandreou shocked European Leaders by calling for a referendum just after being told an agreement was made to increase the bail-out package and banks agreeing to a 50% “Haircut” on their Greek holdings. 

That led the leaders of Germany and France, as well as the IMF, to declare that Athens would not now receive its next tranche of emergency aid until the referendum had passed. Moreover, the question of Greece leaving the euro was raised for the first time by angry eurozone leaders. That forced Mr Papandreou to back down over the referendum, as some might say, what was he thinking?

Italy then came into the spotlight. Italy, Europes third largest economy is also struggling as their cost of borrowing had risen again to the 7% danger level, which had put the new PM Mario Monti under pressure as he tried to form a government. The Italian bond yield had reached 7.039%, indicating continuing market nervousness about the country's debts.

New premier Mario Monti had presented his government for a vote of confidence on his third day in the job. Against that background it is hardly surprising that investors were finding it difficult to muster confidence in Greece and Italy, or that they have doubts about the whole euro shooting match.

From our German colleagues we saw figures showing their third quarter gross domestic product (GDP) reinforce the perception of a yawning gap between Germany and its weaker eurozone brethren. GDP growth in Germany for Q3 was a provisional 0.5%, similar to that of Britain. In Portugal it fell by -0.4% whilst in Spain there was zero growth. For Euroland as a whole the figure was just 0.2%.

As for UK inflation it slowed by more than expected in October, with the consumer price index (CPI) down from 5.2% to 5.0%. However, with the old link between inflation and interest rates severed, the news had no lasting impact on the pound.

In the same week as Bank of England governor Mervyn King was delivering his latest quarterly inflation report, UK unemployment total rose by 129,000 in the three months to September to 2.62 million, with youth unemployment above one million. The unemployment total was the largest since 1994, and the unemployment rate rose to 8.3%, the highest since 1996. Mr King said during his speech that the UK's economic problems were shared by other countries and that the eurozone debt crisis was the "single biggest risk" to the UK.

The Bank had cut its 2011 and 2012 growth predictions to about 1%.