The euro rose against most of the major currencies during yesterday's trading session. The 17-nation currency gained about 60 pips vs. the U.S. dollar and about 30 pips against the British pound. The euro also saw a 120 pip gain vs. the Japanese yen.

The euro strengthened yesterday after two leading European Central Bank policymakers warned of a rising trend of imported inflation. The policymakers have issued the warning after inflation exceeded the ECB's preferred level of just below 2% for first time in two years in December, hitting 2.2 %.

Lorenzi Bini Smaghi, one of the six ECB executive board members, said that a permanent and repeated increase in the prices of imported products will tend to impact on inflation in the advanced countries, including the euro area. Bini Smaghi added that the ECB should address the rising inflation; otherwise monetary policy has to become more restrictive than it should be which leads to slower growth.

Looking ahead to today, the most significant economic release from the euro-zone seems to be the M3 Money Supply report. This report measures the change in the total quantity of domestic currency in circulation and deposited in banks. A positive data has potential to further support the 17-nation currency against its major rivals.