The euro depreciated vis-à-vis the U.S. dollar today as the single currency tested bids around the US$ 1.2730 level and was capped around the $1.2870 level. European Central Bank President Trichet reported the current main refinancing rate target is €œat a very, very low level€ but intimated rates could go lower. Trichet added €œIt is absolutely clear that the present year will be a year of recession in a large number of countries. It is the same in most industrialized economies. It is in the projections of most economists, whether public or private, that in the course of 2010, starting from a very low level, because it is clear that 2009 is a year of deep slowing down, that we will progressively see a pickup.€ Other ECB officials have recently suggested rates could even move lower from their current all-time lows. Also, German January industrial output fell 7.5% m/m, the largest decline on record, and was off 19.3% y/y. EMU-16 January producer price inflation was off 0.8% m/m and 0.5% y/y. In U.S. news, January business inventories declined 1.1% m/m and February headline retail sales were off 0.1% last month, better-than-expected. Also, January retail sales were upwardly revised to +1.8% from the preliminary 1.0% level. Additionally, weekly initial jobless claims rose 9,000 to 654,000 while continuing jobless claims surged to 5.317 million, the highest level since at least 1967. Euro bids are cited around the US$ 1.2385 level.