By Bridge News
London--Feb. 8--The following is a summary of overnight moves since Europe's close, plus possible leaders for the session ahead:
KEY ISSUES:

* EUR retreats on profit-taking, O'Neill, Moskow say no recession
* JPY down as Nikkei hits lowest since Oct. 1998, Japan Q3 GDP revised
down * GBP unsettled as UK PM Blair firms date for EMU decision * German December industrial production

--The EUR came under profit taking pressure in late US trading overnight and ended Asian trading well below Wednesday's highs against the USD, JPY and GBP.
The USD extended its gains against the JPY and staged a recovery against the CHF. Japanese Q3 GDP data was revised down, though household spending data for Q4 was moderately encouraging. Cable dropped sharply ahead of the MPC and on speculation a decision on UK EMU entry is getting closer.
--EUR/USD dropped off Wednesday's 0.9351 high in US trading to hit 0.9278 as the profit takers stepped in and dropped to 0.9259 in late Asian trading.
Pressure may also have come from comments by US Treasury Secretary O'Neill and Fed's Moskow suggesting the US is not in a recession. German final CPI for January was unchanged from the preliminary 0.5% m/m and 2.2% y/y rises. German industrial production for December is due later in the day.
--EUR/JPY was carried lower in the move, touching the 107.80 region. However, the JPY came under pressure on a CIA report that the North Korean regime could collapse, plus a downward revision to Japan's Q3 GDP data. The cross recovered to the 108.42 region while USD/JPY was carried to a 1-week high of 116.57. Japan's Q3 GDP was revised down to a 0.6% m/m fall from the initially reported 0.2% q/q rise. This was countered however, by a 0.2% q/q consumer spending rise in Q4, to give a 2.1% y/y gain. However, the Nikkei ended the day down 227 points, having touched its lowest level since Oct. 1998.
Both pair and cross dropped in the Asian afternoon on persistent selling from Japanese banks. USD/JPY dropped to 116.02 while EUR/JPY fell back to 107.55.
--Cable was hit hard by aggressive selling from a UK account in late US trading, hitting a 2-week low around 1.4500. Position squaring ahead of today's MPC decision plus PM Blair's statement that the government will assess EMU entry in the first 2 years of the next parliament likely played a role. The interest rate decision will be announced at 1200 GMT.
--USD/CHF pulled off Wednesday's 1.6440 low to hit 1.6560 in late Asian trading as the EUR lost ground. The KoF Q4 review is released during the day.
--AUD/USD was pressured by a surprise 3,500 rise in unemployment in January and dropped to a 9-day low around 0.5415 on heavy selling from a major local trading bank.
--USD/CAD dropped off a 2-week high around 1.5145 on profit taking to hit a 2-day low around 1.5075.