EURO
The Euro is trading sideways against the majors this morning as we await key US data today whilst the Euro zone takes a back seat in terms of economic data. The issue of the Greek debt swap deal is ongoing with an announcement yesterday that a meeting this upcoming Monday (Feb 6th) is the new deadline for the parties involved to agree on a deal and I have to say I am not massively optimistic about this one . In other news poor auction results in Spain yesterday have added some pressure on the single currency but German PMI services figures have kept the euro stable in early morning trading.

US DOLLAR
The USD remains very close to where it finished yesterday against the majors after the release of better than forecast jobless claims which fell to 367k . Risk appetite was increased yesterday by Fed Chairman Ben Bernanke testimony to congress perceived as being more bullish than expected. The attention in the foreign exchange markets will now be very much on US non-farm payrolls figures which highlight the number of new jobs created in the US, forecasted to be lower than the previous month.

EURO
The Euro is trading within similar ranges to yesterday against the USD and has made some small losses vs. the more popular pound. There has been some renewed confidence for a debt swap deal after comments from Greek Finance Minister Evangelos Venizelos who said talks with private creditors on a bond swap deal was “one formal step away” from being finalised. Investors are however, continuing to limit their exposure to the single currency especially with the sovereign debt situation in Portugal showing no sign of going away any time soon. The ECB is expected to continue with its policy of offering cheap money to Euro zone banks in order to get much needed funds into companies and consumers in a similar way to the BoE. Demand for riskier currencies remains stable for now.

US DOLLAR
The USD is trading marginally down against sterling and the Euro zone after economic data released was mixed giving little support for the US currency. The ADP employment report disappointed slightly showing the number of new private sector jobs being created had fallen more than expected at 170K in January, analysts had forecast for a drop of 185K for the month. Positive releases came from construction spending data and the ISM manufacturing index, construction spending increased 1.5% in December, up from the 0.4% seen the previous month, while manufacturing activity expanded further with the index increasing to 54.1 from 53.1 in January. This afternoon we await the second of this week’s US jobs data releases with the weekly jobless claims number before the main non-farm payroll number tomorrow.

EURO
The euro is trading stronger against sterling this morning after the pound made some juicy gains in early morning trading before losing 0.5% to the single currency. Against the USD the euro is also trading stronger, currently up 0.40% on the day despite investors growing bearish on prospects for the Euro with the Greek debt swap talks continuing to bumble along. The Portugal situation has also reared it’s ugly head again with expectations for another bailout package adding to already tough austerity measures in the region likely to hamper the Euro zone economy further and the single currency.

US DOLLAR
The USD is losing out to the euro this morning and trading flat against the pound after yesterday’s economic data disappointed the market. Weekly US retail sales activity contracted in addition to manufacturing activity and with lower consumer confidence numbers this all very much supports the Fed’s dovish (low interest rates) stance on monetary policy. The focus today in terms of economic data will be on ISM manufacturing and the ADP non-farm employment change before the main employment data due on Friday afternoon.

EURO
The euro is marginally down against the pound this morning and has made gains of nearly 0.5% vs. the USD on hopes that Greece can reach a debt sap deal with its creditors by the end of this week. Greek Prime Minister Papademos said negotiators have made good progress and that Greece and its private creditors could reach a definitive deal by the end of the week. This optimism has helped the Euro make some small gains and increased appetite in the market for riskier currencies such as the pound and euro.

US DOLLAR
The USD has weakened significantly against the pound and euro this morning on the back of more hunger for risk in the foreign exchange markets as investors monitor events in Europe closely. Yesterday saw a slight drop in US personal consumption data but this figure was not viewed upon as significantly negative. The release of the Dallas Fed region manufacturing aided appetite for risk with the data showing a strong improvement in activity for January. This afternoon sees the release of some employment and consumer confidence data in the US.

EURO
The Euro is down by nearly three quarters of once percent this morning vs. the USD and is trading weaker against the pound ahead of a big day for the euro zone with a summit in Brussels ongoing and talks continuing between Greece and private creditors on a debt swap deal. There is some speculation in the market that EU leaders are expected to sign a deal for a permanent bailout fund in the euro zone and renewed legislation. However these talks may be overshadowed by the ongoing Greek debt saga and how a deal will be reached with creditors for them receiving the next bailout amount due.

US DOLLAR
The USD is up against the pound and euro this morning, bouncing back from lows seen last week after the Federal Reserve kept interest rates at their current level with no change expected until 2014 in addition to weaker growth figures in the US. More recent data from the University of Michigan indices showed confidence in a continued economic recovery for the US remained, also aided by reasonably strong GDP data which came out at 2.8%, marginally below the 3% forecast. Today sees the release of personal consumption and manufacturing data in the US.

EURO
The Euro remains stronger against a weaker USD this morning up 0.39% also up marginally against the pound. The Euro has been relatively stable towards the end of this week supported by hopes (and they are hopes) for a Greek debt swap deal to avoid a messy default. The single currency is however being hit at from another angle with increasing concerns that Portugal may be heading for a second bailout and debt write downs.

US DOLLAR
The USD weakness is continuing today with the pound holding above 1.57 and 0.25% up on the day whilst the single currency has made gains of 0.38%. The Fed’s commitment to keep US rates on hold through the end of 2014 has sparked some concerns that a third round of quantitative easing may be required to stimulate the US economy, weakening the US currency. The main highlight for this afternoon is advance GDP for the US economy forecast at 3.0%, this is likely to have the biggest impact out of the three growth figures (for the last quarter) and is likely to have a negative impact on the market if the number is significantly below forecasts.

EURO
The Euro is continuing to climb against the USD especially after the US currency has shown some weakness in the market with the rate now moving above 1.31 and pushing down to the lower end of 1.19 against the pound. The single currency is however, still very much exposed to the debt crisis in the euro zone so these recent gains may well be short lived depending on whether the ECB and IMF can bring any kind of resolution.

US DOLLAR
The USD is trading lower against it’s counterparts this morning after the Federal Reserve confirmed it would keep rates near to zero until as late as 2014 (wow) and is ready to opt for more monetary easing. The FOMC (US central bank committee) delivered a negative tone at their press conference yesterday with Ben Bernanke (chairman) making it clear the Fed was considering more asset purchases to aid the US economy, resulting in an immediate sell off on the US currency benefitting the euro and pound in addition to a basket of other currencies.

EURO
The Euro is by no means out of the woods but a general move towards more risk in the last few days has seen the single currency trade up into 1.30 against the USD and keep the pound at bay around the 1.19 level. The Euro was also supported yesterday by better than expected euro zone services and manufacturing data, although the unresolved Greek debt swap deal is continuing to hinder any major gains. This morning has seen the release of German IFO Business climate data which measures economic health and was slightly better than expected, providing even more positive news…

US DOLLAR
The USD has made some small gains against the Euro and pound this morning before the raft of economic data due this afternoon and tonight. US pending home sales is expected to show a fall to –0.6% from 7.3% last time ahead of the FOMC statement due at 5.30pm followed by the press conference at 7.15pm and US President Obama’s state of Nation speech this evening.

EURO
The Euro is trading strongly this morning against the pound and has managed to touch 1.30 against the USD benefitting from hopes of an eventual deal to restructure Greek debt despite euro zone finance ministers’ rejection of a debt swap offer by private creditors. In recent economic data German and French manufacturing and service sector data came in better than expected seen as positive for the Euro zone in addition to industrial new orders dropping by less than forecast.

US DOLLAR
Confidence in the currency markets helped by better economic data in the US has aided riskier currencies with them gaining support against the USD, with the euro touching 1.30 and the pound staying within 1.55 against the US currency. There is only one small piece of US manufacturing data due today as tomorrow brings a juicer one in the afternoon with the release of pending home sales and the FOMC (central bank) announcement.

EURO
The Euro is trading relatively flat against the pound but has made further gains against a weaker USD, now trading comfortably into 1.29. Greece and its talks with private creditors is continuing to steal the limelight with private creditors saying yesterday that they has come to the limits of what losses they could maintain in a Greek debt swap, shifting the responsibility to the EU and International Monetary Fund (IMF). This afternoon sees the release of consumer confidence data before a bunch of French, German and European manufacturing and Industrial production data tomorrow.

US DOLLAR
The USD is continuing to be put under pressure at the start of this week, mainly by an improvement in market confidence and US existing home sales which increased in December adding to market confidence and appetite for risk. There is no economic data due today but the Federal reserve bank will be meeting tomorrow to discuss monetary policy, it is therefore unlikely we will see any large USD based moves today before tomorrow.