During early European deals on Thursday, the euro showed mixed trading against its major counterparts. While the euro jumped to a 2-day high against the yen and the franc, it recovered recent losses against the pound. On the other hand, the euro showed choppy trading against the dollar.
The German GfK consumer confidence report for April, French March consumer confidence index, Italian March business confidence and trade balance data for February, Euro-zone M3 money supply for February, which were released today likely influenced the euro.
A survey from the GfK market research group showed that German consumer confidence for April stood at 2.4 points, down from a revised value of 2.5 points in March. Economists were expecting a reading of 2.5 for April.
Economic expectations in March dropped 4.9 points to minus 32.8, while income expectations remained virtually stable. The index measuring propensity to buy stood at 13.9 points in March, which was 24 points above the level recorded at the same time in the previous year.
The euro, which closed yesterday's trading at 132.50 against the yen rose to a 2-day high of 133.49 during early deals on Thursday. The next upside target level for the euro-yen pair is seen at 134.5.
A surge in stock prices dragged the Japanese currency down. World stocks rose on speculation that concerted efforts initiated by the central banks as well as governments will succeed in pulling out the global economy out of recession sooner-than-expected. Positive data from the U.S. related to durable-goods orders and new home sales and higher closing in Wall Street on Wednesday further raised speculation that the global economy might have bottomed out.
The Bank of Japan said that corporate service prices in Japan were down 2.6% year-over-year in February. Forecasts called for a 2.5% year-over-year drop after the 2.2% annual decline in January. On a monthly basis, corporate service prices inched higher by 0.2%.
The euro gained against the Swiss franc after hitting a low of 1.5208 at 5:15 am ET Thursday. Currently, the euro-franc -pair is trading at a 2-day high of 1.5300, compared to Wednesday's close of 1.5232. On the upside, 1.536 is seen as the next target level for the European currency.
The euro fell to 0.9280 against the pound before bouncing back at 4:50 am ET Thursday. As of now, the euro-pound pair is trading near Wednesday's close of 0.9339 with 0.937 seen as the next target level.
The pound eased after a report showed that UK's retail sales dropped 1.9% in February from the previous month, while economists were expecting a monthly 0.4% decrease. From the previous year, retail sales volume rose 0.4% in February, which was the lowest growth since September 1995. Annual growth stood below 2.5% increase expected by economists.
During early deals on Thursday, the euro largely bounced between 1.3540 and 1.3618 against the dollar. The next downside and upside target levels for the euro-dollar pair are seen around 1.32 and 1.374, respectively. At yesterday's New York session close, the pair was quoted at 1.3586.
Traders now look forward to the New York session, in which the US Bureau of Economic Analysis is due to release its final fourth quarter GDP report at 8:30 am ET. The report is likely to show that the U.S. economy contracted by a 6.6% rate in the quarter.
At the same time, the Labor Department is due to release its customary weekly jobless claims report for the week ended March 21st.
Various Fed officials are scheduled to speak today. Treasury Secretary Timothy Geithner is scheduled to testify on financial regulation reform before House Financial Services Committee in Washington at 10 am ET.
Dallas Federal Reserve Bank President Richard Fisher is due to speak to students as part of the ninth annual Redefining Investment Strategy Education Forum at the University of Dayton at 12 pm ET.
Richmond Federal Reserve Bank President Jeffrey Lacker is scheduled to be the keynote speaker for the 2009 Economic Outlook Conference and luncheon of the Charleston Metro Chamber of Commerce, in Charleston, South Carolina at 12:40 pm ET, while Minneapolis Federal Reserve Bank President Gary Stern would speak at a luncheon of the Economic Club of Minnesota in Minneapolis on Better Late Than Never: Addressing Too-Big-To-Fail at 1 pm ET.
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