01:45 Australia RBA Assist Gov Edey Speaks March
08:00 Eurozone Cyprus Parliament votes on the banking/fund bills
09:00 Germany IFO - Business Climate March 107.4 107.8 106.7
09:00 Germany IFO - Current Assessment March 110.2 110.4 109.9
09:00 Germany IFO - Expectations March 104.6 105.0 103.6
The euro rose sharply against the dollar, as investors continue to eagerly catch news from Cyprus. Government spokesman said that the next few hours will be crucial for the country, as parliament prepares to vote on the membership of Cyprus in the eurozone. Meanwhile, the ECB announced that on March 27 22 banks repay loans, in the program LTRO. Estimated volume of maturity was € 1.936 billion in the economic calendar today is empty, and therefore the main driver of currency movements and volatility will be the development of the situation around Cyprus.
We also add that the European growth will not prevent even the data showed that the index of business sentiment in Germany, which is the largest economy in the euro zone fell unexpectedly in March, after a sharp rise in February. Businesses are less optimistic about their export.
Business climate index fell in March for the first time in five months, reaching 106.7 points against 107.4 points in February. The average forecast implied increase in the index to the level of 107.8 points. Ifo index decline followed the same unexpected (in terms of average forecasts) decline of business activity from Markit. Weak data on business activity index call into question the ability of the German economy to quickly recover after weak Q4. Ifo president said that the German economy is in difficult circumstances. He also noted the reduction of positive expectations about the prospects for export manufacturers.
The yen rebounded with minimum values session against the dollar will recover in most of their losses, but investors are still relentlessly catch the news on the Cypriot issue. Although recent media reports that Russia has refused to fund the Cyprus, the Russian Prime Minister Medvedev said the door was slammed and the country may agree to assist. EU representative Barroso said that the position of the Eurogroup in the Cyprus issue is unanimous, and that the state is suffering from enlarged banking system, but the solution to this problem can be found.
EUR / USD: during the European session, the pair rose to $ 1.2965
GBP / USD: during the European session, the pair rose to $ 1.5212
USD / JPY: during the European session the pair fell to Y94.19, but later rose to Y94.85
At 14:00 GMT Belgium release index business sentiment for March.
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