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Yesterday the yen rallied against all of its major counterparts as speculation increased that the surge in oil prices this month and Europe’s unsettled debt crisis may weigh on economic recoveries, boosting demand for safety.
The euro extended its decline, falling by the most in more than three months against the yen, after Standard & Poor’s placed the region’s rescue fund on negative outlook. The euro briefly extended its losses against the dollar after S&P cut its outlook on the bailout fund, the European Financial Stability Facility, to negative, reflecting a similar move on two euro-area nations that act as guarantors to the facility. The EFSF lost its top credit rating in January after earlier downgrades to France and Austria. The euro remained lower even after Germany’s lower house of parliament approved a second Greek bailout package worth 130 billion euros ($174 billion). German Chancellor Angela Merkel and euro-area leaders now shift their focus on whether to bolster the region’s bailout firewall as they prepare for a summit meeting in Brussels on March 1-2.
EUR/USD: yesterday the pair corrected, receded on a floor of a figure.
GBP/USD: yesterday the pair corrected, receded on a floor of a figure.
USD/JPY: yesterday the pair fell to a figure, lowered below Y81.00.
Release of the final state CPI data from Germany will see the flash HICP data for February today, although scheduled data releases in Europe start at 0710GMT with German GfK consumer confidence data. EMU data at 1000GMT includes the economic sentiment survey and business climate indicator for February. At 1730GMT there is a speech by SNB vice president Thomas Jordan at the Neue Zuercher Zeitung panel discussion, in Zurich. US data starts at 1245GMT with the weekly ICSC-Goldman Sachs Mall data, while at 1330GMT, durable goods orders are expected to fall 1.0% in January, after rising 3.0% in December. The weekly Johnson Redbook Chain Store Sales data is then due, at 1355GMT, just ahead of the 1400GMT release of the S&P/Case-Shiller Home Price Index. At 1500GMT, consumer confidence is forecast to rise to a reading of 63.0 in February after dipping to 61.1 in January.
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