The euro appreciated vis-à-vis the U.S. dollar today as the single currency tested offers around the US$ 1.4715 level and was supported around the $1.4590 level. Technically, today’s intraday low was just below the 50% retracement of the move from $1.4310 to $1.4920. More downbeat U.S. economic data were released today. First, weekly initial jobless claims fell 21,000 to 301,000 while continuing claims rose 66,000 to 2.751 million. Second, December home construction fell to its lowest level in sixteen years, off 14.2% m/m to an annualized 1.006 million units, much worse than expected. Also, December housing starts were off 38.2% y/y and for all of 2007, starts were off 24.8% from 2006’s level. Federal Reserve Chairman Bernanke testified in Congress today and reiterated the FOMC was prepared to enact substantive rate cuts if required to counter the risks associated with a slowing economy and dislocations in the financial markets. Bernanke also endorsed a proposed economic stimulus plan if it is enacted quickly and noted core inflation remains elevated. Similarly, Cleveland Fed President Pianalto said the U.S. economy has moved to a slower growth track and added she is concerned the Fed could lose the public’s confidence in maintaining price stability. Other data released in the U.S. today saw the January Philadelphia Fed’s general business conditions index fall to -20.9. The Fed’s Beige Book yesterday said economic growth moderated between November and December. In eurozone news, the euro came off yesterday on comments from ECB member Mersch who yesterday said there are certainly downside risks and added the ECB may look through oil-driven inflation. Mersch also spoke today and said the ECB recently discussed keeping rates steady and raising them only. Data released in the eurozone today saw the EMU-13 November trade surplus fall to €2.6 billion. The ECB today noted base inflation effects are likely to have a strong downward impact on inflation in 2008. Finance ministers from the U.K., Germany, France, and Italy convene in Paris tonight ahead of the G7 meeting in Tokyo on 9 February. Euro bids are cited around the US$ 1.4540 level.