The euro eased against the major currencies in early deals today, following yesterday's strong gains on the back of dismal US consumer confidence data. At 0910, the single currency stood at USD1.0745, while against sterling it was STG0.6820. However, the single currency is seen recovering to continue exploiting sterling and dollar weakness as the session progresses.
"Comments from the BoE's chief economist that sterling may need to fall further to help correct the UK's current account deficit, as well as the UK's stance on the Iraqi issue, will leave it open to another breach of STG0.685," said Geraldine Concagh, senior economist with AIB Global Treasury. She added that today's parliamentary vote on the Iraq issue, which could leave Tony Blair facing a rebellion from his own MPs, would overshadow the release of revised Q4 GPD data. "Notwithstanding bouts of profit taking given its sharp fall, weak UK data and any suggestion of further cuts in interest rates will weigh heavily on sentiment. Greenspan is speaking today but we expect nothing new on the US economy," she said. ///www.fxcentre.com