The euro held its own against the US dollar yesterday, as has been the story for much of this week. However, the single currency did weaken steadily against sterling as data from the UK Services sector come out better than expected. Eurozone Retail Sales data saw a 1.6% increase in the value of sales in the Eurozone during the first month of this year; however, even though this was viewed as positive it seemed to have little impact on the performance of the euro yesterday.
Today we are likely to see more movements in euro rates as the most important event of the week gets underway in the form of the European Central Bank interest rate decision and following press conference. The majority of commentators are now expecting there to be no change in interest rates so any reduction will almost certainly affect the strength of the single currency. The maintenance of current interest levels may lend some strength to the euro, however this may be enhanced or counteracted by the tone of the subsequent press conference, which will be closely monitored by traders.
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