The euro appreciated sharply vis-Ã -vis the U.S. dollar today as the single currency tested offers around the US$ 1.5600 figure and was supported around the $1.5405 level. Traders lifted the common currency higher as risk appetite returned to the market. Very weak economic data were released in the U.S. today that saw March consumer confidence print at 64.5, down from 76.4 in February â€“ the weakest print in more than five years. Similarly, the expectations and present situation sub-indices fell sharply. Also, it was reported that the Standard & Poors/ Case-Shiller house price index fell 11.4% in January, its largest drop since at least 1987. Goldman Sachs today estimated that U.S. financial institutions are likely to assume about US$ 460 billion in credit losses after loan loss provisions are made but estimates that banks have only made provisions for about US$ 120 billion thus far. In eurozone news, traders await the release of tomorrowâ€™s German Ifo business sentiment survey. Traders may reshape their expectations regarding the European Central Bankâ€™s likely course of monetary policy if tomorrowâ€™s print is weak. The ECB today allocated an additional â‚¬50 billion in its regular weekly refinancing operation, meaning he central bank allocated â‚¬216 billion in seven-day funds at 4.23% or higher. The massive liquidity provision didnâ€™t have a major impact on short-term lending rates, and this may be one factor that prompts the ECB to expand monetary policy despite uncomfortably high inflation. Euro bids are cited around the US$ 1.5145 level.
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