The pound made up significant ground to close Friday slightly higher than the euro

Having dropped to a one-month low of 1.0950 against the single currency on Friday morning, the pound steadily recovered to close the day marginally higher at 1.1010.

• Sterling continued to slide in early trading on concerns about the potential damage to the fragile UK banking sector from Dubai's surprise delay on debt repayments.
  
• On Wednesday, Dubai moved to restructure its biggest corporate debtor, Dubai World, and delay repayment on some of the company's $59 billion of liabilities.
  
• Major UK banks have made large investments in Dubai, which has exposed them to the financial problems facing the country. Additionally, Middle Eastern players have been big buyers of sterling in recent weeks.
  
• But the pound came off its lows as UK shares recovered, led by bank shares which were hammered on Thursday. London's FTSE 100 was up 0.8% on the day after falling sharply earlier in the session.
  
• In trading this morning the pound is approaching its one-month low against the euro after figures showed an unexpected fall in UK consumer confidence underlining ongoing weakness in Britain's economy.