The euro gave back recent gains vis--vis the U.S. dollar today as the single currency tested bids around the US$ $1.5845 level and was capped around the $1.5985 level. The common currency came within fifteen pips of testing the psychologically-important US$ 1.6000 figure before traders booked profits. Data released in the U.S. today saw the April Philadelphia Fed manufacturing survey fall to -24.9 in April from -17.4 in March while the March leading index moved higher 0.1% - the first increase in six months. It was also reported that weekly initial jobless claims climbed 17,000 to 372,000 while continuing jobless claims rose 26,000 to 2.984 million, the highest since June 2004. Federal Reserve Vice Chairman Kohn today suggested a more permanent liquidity backstop for primary dealers to maintain the orderly functioning of the U.S. securities market. In eurozone news, European Central Bank member Weber hawkishly reported the ECBs staff may need to upwardly revised inflation expectations in June. The most recent assessment by the ECB in March projected an average inflation rate of around 2.9% for 2008. Eurogroup President Juncker verbally intervened against the euros rise today saw the markets should not underestimate the Group of Sevens comments this past weekend about currencies. The ECBs April bulletin was released today and reported temporarily high inflation rates may remain for some time, principally on account of elevated food and energy prices. EMU-15 economic data released today saw the EMU-15 trade surplus reach 800 million in February. Euro bids are cited around the US$ 1.5345 level.
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