Yesterday saw the euro drop off to fresh two-and-a-half-year lows against the US dollar yesterday, with the Eurozone currency seemingly still feeling the hangover from Friday’s strong US jobs report. Falling to 1.225 in the early session, the single currency did manage to stage a subdued comeback in the afternoon against both its US and UK counterparts, but still remains weak against its primary pairings. Comments made by a senior European Central Bank (ECB) policymaker – who talked up the benefits of a ‘shock and awe’ quantitative easing strategy – also weighed heavy on the euro. Thursday could be a key day as we will find out how well the offer of cheap loans from the ECB has been taken up. If the uptake is poor it will undermine the euro as it will increase the likelihood of full blown quantitate easing in the Eurozone.
Looking forward to today, we have no fundamental data releases of particular note. One thing to keep an eye on with be the ECOFIN meetings held in Brussels, attended by the Finance Minister of all EU member states.