European session review: european currencies are strengthening.
The euro traded close to a one-week high against the dollar amid optimism European leaders may take action to quell the region’s debt crisis, underpinning the appeal of the region’s assets.
The 17-nation currency was little changed after three days of gains after demand rose at a Spanish debt sale, and as European Central Bank policy makers meet today in Frankfurt. The franc fell against its 16 most-traded peers after Swiss central bank Vice President Thomas Jordan said the currency’s renewed ascent is posing a threat to growth. Sweden’s krona declined from a 10-year high as inflation accelerated less than analysts forecast in December.
“This chatter of action is probably going to provide some degree of support for the euro,” said Steve Barrow, head of research for Group of 10 currencies at Standard Bank Plc in London. “The market is minded to sell the Swiss franc in this less risk-averse environment.”
The euro was little changed at $1.3137 as of 11:07 a.m. in London, after reaching $1.3171, the highest since Jan. 5. It jumped 1.2 percent yesterday, the most in a month. Against the yen, the euro climbed 0.1 percent to 109.08. The dollar was little changed at 83.04 yen.
Europe’s single currency appreciated as much as 1.1 percent to 1.2836 Swiss francs, the most since Dec. 16, before trading at 1.2784. The franc weakened 0.7 percent to 97.32 centimes per U.S. dollar.
US data starts at 1330GMT with weekly jobless claims data, trade data and also PPI.
EUR/USD the euro is strengthening.
GBP/USD the pound is strengthening.
USD/JPY the yen is trading rangebound.
Initial jobless claims are expected to fall 3,000 to 406,000 in the January 8 week.
The international trade gap is forecast to widen to $41.0 billion in November after narrowing to $38.7 billion in October. Analysts will be watching the data closely to help set up their 4Q GDP forecasts.
Meanwhile, producer prices are expected to jump 0.9% in December. The core PPI is expected to rise 0.2%, as the power to pass on higher input prices remains very weak.