The euro remains close to USD1.12 this morning as the market awaits the latest US consumer sentiment index from the University of Michigan. At 0930, the euro was worth USD1.1182 - having hit USD1.1270 yesterday - and 70.22p sterling. The sentiment index is expected to edge higher, reflecting recent figures indicating that the US economy is recovering, but the market is divided on how the dollar will react to the news. "With the poor labour market data undermining the markets confidence in a US recovery, it could take strong surprises to the upside to trigger any dollar rebound," said Geraldine Concagh, senior economist at AIB Treasury. Analysts say the preliminary September reading from Michigan will edge up to 90.5 from 89.3 in August.
In addition, the Michigan number will also have to be good enough to put yesterday's poor current account deficit and weekly jobless claims in the background. But some analysts believe the rapid euro rebound - from USD1.07 to USD1.12 in 10 days - may prompt the market to take any positive data and use it as an excuse to buy some cheaper dollars, which would push the euro lower again ahead of the weekend///www.fxcentre.com