The euro strengthened vis-à-vis the U.S. dollar today as the single currency tested offers around the US$1.4745 level and was supported around the $1.4650 level. Technically, today’s intraday high was right around the 23.6% retracement of the move from $1.4015 to $1.4965. Market volatility has been significant following yesterday’s interest rate announcement from the Federal Open Market Committee wherein policymakers reduced the fed funds target rate by 25bps to 4.25%, disappointing a large segment of the market that wanted a 50bps easing. The Fed cited an intensification of the housing correction and some softening in business and consumer spending. Notably, the Fed also cited difficult financial market conditions twice in its policy statement, an indication the Fed may be inclined to ease rates further at the FOMC meeting in late January. Boston Fed President Rosengren dissented with the majority and voted for a 50bps easing, one clue that debate may have been fierce yesterday. The greenback gave back some of yesterday’s intraday gains today vis-à-vis the euro and British pound following a rare concerted move from top global central banks to supply the money markets with a tremendous amount of year-end liquidity. The Fed, European Central Bank, Bank of England, Bank of Canada, and Swiss National Bank announced a series of measures to reduce interbank funding pressures. The Fed will hold four term auctions for tens of billions of dollars and has initiated swap agreements with central banks to reduce U.S. dollar interbank lending strains. Data released in the U.S. today saw October import prices ris 2.7% m/m, the largest monthly gain since October 1990, while the October trade deficit widened to –US$ 57.8 billion. In eurozone news, European Central Bank member Ordonez said it is crucial there are no second-round (inflation) effects. Data released in the eurozone today saw October EMU-13 industrial output up 0.4% m/m and 3.8% y/y. Also, Q3 employment was up 0.3% q/q and 1.9% y/y. Euro bids are cited around the US$ 1.4565 level.