Monthly Report

Deutsche Equity Income Trust PLC
14 October 2003



                          Deutsche Equity Income Trust

                     REPORT FOR THE MONTH OF SEPTEMBER 2003



MARKET BACKGROUND

There was a reversal in fortunes over the month, with the FTSE All-Share Index
falling by 1.8% in capital terms and larger companies modestly outperforming
both mid- and small-cap stocks. Equity investors looking for income also fared
poorly, with the FTSE 350 Higher Yield Index underperforming the FTSE 350 Lower
Yield Index by 3.4% in capital terms over the month due to poor performance from
heavily-weighted sectors Oil & Gas and Financials.

Against this difficult background, performance over the month was satisfactory
with our net asset value per share falling by 1.4%. The share price fell by 1.9%
over the same period, moving from par to a 0.5% discount to net asset value.

The best performing sectors over the month were the 'defensive' areas of Food &
Drug Retailers (helped by positive trading updates from Tesco and William
Morrison), Pharmaceuticals (despite further weakness in the US$), Telecoms and
Tobacco. The worst performing sectors were the 'cyclical' areas of Steels &
Other Metals (further disappointment at Corus) and Insurance (deeply discounted
rights issue from Royal & Sun Alliance). Mining stocks also performed poorly,
hit by further weakness of the US$ and strength of the South African Rand
putting pressure on profit forecasts and high valuations.

Major transactions during the period included adding to existing holdings in
Barclays and BSkyB as well as establishing new holdings in VT Group and Severn
Trent. Holdings were sold in Lonmin and significantly reduced in SIG following
recent outperformance.

OUTLOOK

The recently-published minutes of the last meeting suggest that the MPC expect
the next move in interest rates to move upwards. With the world economy
recovering and domestic demand picking up, this would seem to be a natural
conclusion. However, the switch to a new index for inflation-targeting, from the
old RPIX to HCIP, complicates matters. Inflation is above target and arguably on
a rising trend according to RPIX, whereas HCIP seems to portray the opposite. It
is therefore unclear how soon interest rates are likely to rise and, given that
more than half of mortgage lending is now at fixed rates, there should not be a
detrimental impact upon the housing market.

One cause for concern, however, is the recent sharp increase in the oil price to
over US$28 per barrel following OPEC's surprise announcement to cut production.
Any sustained increase in the price of oil will have a detrimental effect upon
GDP growth and, ultimately, corporate profitability and cash generation.


                                        30/09/03                31/08/03

NET ASSET VALUE                           212.0p                  215.0p

MID-MARKET SHARE PRICE                  30/09/03                31/08/03
Ordinary Shares                           211.0p                  215.0p
Dividend Yield (%)                           3.6                     3.5

Discount/(Premium) (%)                       0.5                     0.0

LARGEST HOLDINGS (market value £61.2 million equal to 71.1% of total portfolio)

                                         £'000's         % of portfolio
HSBC Holdings                              6,895           8.0

BP                                         5,674           6.6

GlaxoSmithKline                            5,353           6.2

Royal Bank of Scotland                     4,052           4.7

AstraZeneca                                3,905           4.4

Vodafone Group                             3,398           4.0

Shell Transport and Trading                3,268           3.8

Barclays                                   3,015           3.5

BT Group                                   2,572           3.0

Scottish & Southern Energy                 2,525           2.9

Tate & Lyle                                2,150           2.5

Lloyds TSB                                 1,657           1.9

Imperial Tobacco                           1,647           1.9

Gallaher                                   1,606           1.9

National Grid Transco                      1,604           1.9

Legal & General                            1,429           1.7

Provident                                  1,364           1.6

Morrison (W) Supermarkets                  1,321           1.5

Viridian Group                             1,295           1.5

BPB                                        1,174           1.4

3i Group                                   1,097           1.3

GUS                                        1,092           1.3

British Sky Broadcasting                   1,056           1.2

Vardy (Reg)                                1,029           1.2

Bunzl                                      1,021           1.2
FINANCIAL CALENDAR

Year-end results announced

                                                             24 October 2003

For further information, contact Graham Ashby at Deutsche Asset Management on
020-7545-6000.

For additional copies, changes of address or details of our Private Investors'
Plan, low cost ISA and Dividend Reinvestment Plan (a plan through which
shareholders, who hold their shares on the Company's main register, can use
their dividends to purchase further shares) contact Mark Pope on 020-7545-0520,
e-mail address: [e-mail]. Further details of Deutsche Equity Income
Trust including the latest annual, interim and monthly reports can be found on
the Deutsche Investment Trust Managers website located at
www.deutsche-its.co.uk.

Issued by Deutsche Equity Income Trust PLC and approved by Deutsche Investment
Trust Managers Limited authorised and regulated by the Financial Services
Authority and manager of Deutsche Equity Income Trust PLC. Investors should be
aware that past performance is not necessarily a guide to future returns, the
price of shares and the income from them may fall as well as rise and investors
may not get back the amount they invested.


                      This information is provided by RNS
            The company news service from the London Stock Exchange