The euro depreciated vis-à-vis the U.S. dollar today as the single currency tested bids around the US$ 1.4720 level and was capped around the $1.4845 level. The common currency extended its recent pullback on growing doubts the European Central Bank will continue to tighten monetary policy. Traders also added to U.S. dollar exposure after U.S. GDP growth between July and September was upwardly revised to 4.9% from 3.9%, its strongest level in four years. The dollar’s gains were limited, however, that GDP growth in the current October-to-December period could be weak around 1.5% or so. There is also a changing perception in the market concerning interest rate differentials. Some traders are now buying U.S. dollars on the premise lower rates will help bolster U.S. economic growth, rather than unfavourable diminish U.S. interest rate differentials. Remarks from Fed Vice Chairman Kohn were dovish yesterday and the November Beige Book cited decelearing growth, relatively soft retail spending, and a quite depressed real estate sector. Most traders believe the FOMC will ease monetary policy by 25bps or 50bps on 11 December. Other data released in the U.S. today saw weekly initial jobless claims up 23,000 to 352,000 while continuing jobless claims were up 112,000 to 2.67 million. Additionally, existing home sales were up 1.7% to an annualized 728,000 in October and were off 23.5% y/y while the government’s Q3 home price index fell 0.36%, the first decline in thirteen years. Fed Governor Mishkin speaks later in the U.S. session. In eurozone news, Bundesbank sees 2007 German GDP growth at 2.5% and around 2.0% in 2008 and warned of abrupt movements in exchange rates. The German government reported November’s jobless figure fell 53,000. European Central Bank official Liebscher reported upside inflation risks continue to prevail. Euro bids are cited around the US$ 1.4690/ 25 levels.