The euro plummeted vis-Ã -vis the U.S. dollar today as the single currency tested bids around the US$ 1.5395 level and was capped around the $1.5650 level. The common currency gave back ground as traders reacted to comments from European Central Bank officials Mersch and Quaden that imply the central bankâ€™s monetary policy may be shifting from its current hawkish stance. Data released in the U.S. today saw the February consumer confidence index fall 0.3% while the March Philadelphia Fed manufacturing index rose to -17.4. Also, weekly initial jobless claims were up 22,000 to 378,000 while continuing jobless claims rose 32,000 to 2.865 million â€“ the highest level since August 2004. Traders are also squaring their positions ahead of the long Easter holiday weekend when liquidity is expected to dry up in many trading centers. Additionally, traders have been reducing their short U.S. dollar exposure on a growing concern that global monetary officials could intervene to strengthen the U.S. dollar on a major scale. In eurozone news, the EMU-15 March PMI services survey fell to 51.7 from 52.3 in February while the manufacturing PMI survey fell to 52.0 from 52.3. The European Central Bank launched a fine-tuning operation today to provide additional liquidity to the market. Other data released today saw February producer price inflation up 0.7% m/m and 3.8% y/y. Euro bids are cited around the US$ 1.5610 level.
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