NEWS / Foreign Exchange

the euro is a bit weaker this morning

Economic data out overnight was a bit light. French confidence strengthened slightly from an upwardly revised 108 to 109 in March.

Nevertheless, the euro is a bit weaker this morning. As a matter of fact, most currencies are trading a bit weaker against the dollar this morning.

International economic data this week is likely to show relative continued strength in the German economy - even if the Ifo index falls slightly tomorrow morning. We also see the Japanese economy as being on solid footing, but with an easing of inflationary pressures, the BoJ is likely to be on hold for a little while still.

Today's big U.S. data includes new home sales. February's sales rate is expected to show a boost over January's rate of 937K. We expect an above-consensus rate of sales at 1020K. Although the dollar has moved higher against most major currencies this morning, if the seasonally adjusted annual rate of new home sales rises above a million, expect the greenback to strengthen further.