The Dollar once again made large gains against a basket of currencies during Thursday's trading, climbing to a new three month high. Fueling the appreciation of the dollar were fears of Greece defaulting on their sovereign debt as traders looked to avoid the euro. Analysts are also forecasting just when the Fed will initiate its tightening of U.S. monetary policy.

Today the dollar rose by more than 0.9% versus the euro to close at 1.4389, up from an opening price of 1.4522. Driving the change in the exchange rate was the downgrade of Greek sovereign debt by the rating agency, S&P. The firm also warned of potential future downgrades unless major changes to the fiscal status of the nation are undertaken. The downgrade of Greece is weighing on the EUR as traders are now looking at the U.S. economy in a better light relative to the European economy. This is also causing traders to reexamine the potential of the Federal Reserve to increase interest rates. No change was made at the conclusion of the FOMC meeting on Wednesday; however, with the rally of the U.S. dollar, the Fed may reevaluate its decision at it next meeting.

Friday's trading will be highlighted with a glut of news events and economic data releases from the Euro-zone. The prime market mover will be the German Ifo Business Climate. The survey from manufactures, builders, and retailers is highly respected and shows a high correlation with the German economy. The indicator is s scheduled to be released at 4:00am GMT. The trend of the strengthening dollar may continue into today's trading day with the EUR/USD seeing a significant support level at 1.4270.