Overnight equity marts continued to rally on the back of the late NY news yesterday that the Obama administration is working on a program to subsidize some home mortgage payments. European bourses have added about +1.7% on average at last look. Eurozone economic data, however, continued to come in bleak. The most noteworthy was the larger than expected decline in eurozone GDP to a -1.2% annual rate in 4Q after a +0.6% read the prior quarter. This is now well below the US -0.2% run-rate for the same quarter and highlights the quicker pace of deterioration across the pond.

EUR/USD was punished about -75 pips and sitting near 1.2850/60 ahead of the NY session. 1.2830 area looks like the next pivot for downside here while resistance lurks by 1.2900 as well. The yen crosses were mixed and reflected EUR weakness. USD/JPY added about 35 points into 91.50/60 while EUR/JPY shed -10 pips towards the 117.80/90 zone. USD/CAD continued to grind lower and lost -40 pips to 1.2340/50 despite oil prices remaining heavy just under the $34/bbl level. The pair is well off the 1.2280/75 overnight lows and looks poised to make a recovery if oil remains heavy in NY trading today.

Consumer confidence data for the US along with what is expected to be passage of the revamped stimulus package by the US House are likely to drive risk trades today. Look for the yen crosses to be better bid if the passage of the stimulus elicits a rally in US equities as we head into the long weekend. We would be cautious about taking big positions into the weekend however, as the G-7 statement is due to be released tomorrow and while it could end up being a non-event, the risk that they say something market moving is palpable.

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* 2/13 13:30 GMT CA New Motor Vehicle Sales MoM DEC -7.00% -15.00%

* 2/13 15:00 GMT US U. of Michigan Confidence FEB P 61.2 61.3