The euro appreciated vis-à-vis the U.S. dollar today as the single currency tested offers around the US$ 1.3040 level and was supported around the US$ 1.2885 level. Data released in the U.S. today saw the February housing price index climb 0.7%, defying expectations of a 0.7% decline and a postive indication about the severely beleaguered U.S. housing industry. U.S. banking giant Morgan Stanley announced a US$ 177 million loss in the first quarter. The International Monetary Fund downgraded its global economic outlook and now sees a 2009 economic retraction of 1.3% from the previous forecast of +0.5%. In eurozone news, traders continue to expect the European Central Bank will ease monetary policy next month, taking the main refinancing rate lower to 1.0% from 1.25%. There is also a strong possibility the ECB will announce quantitative easing measures next month, possibly by purchasing sovereign assets in the secondary market or extending the term on its refinancing operations. Euro bids are cited around the US$ 1.2765 level.