EU session review: Yen, Swiss Franc weaken

Data released
07:00     UK     Nationwide house price index (February)    0.3%    -0.2%    -0.1%
07:00     UK     Nationwide house price index (February) Y/Y    -0.1%    -    -1.1%
08:45     Italy     PMI (February)    59.0    57.6    56.6
08:50     France     PMI (February)    55.7    55.3    54.9
08:55     Germany     PMI (February) seasonally adjusted    62.7    62.6    60.5
08:55     Germany     Unemployment (February) seasonally adjusted    -52K    -14K    -13K
08:55     Germany     Unemployment (February) seasonally adjusted, mln    3.069    -    3.135
08:55     Germany     Unemployment rate (February) seasonally adjusted    7.3%    7.4%    7.4%
08:55     Germany     Unemployment (February) seasonally unadjusted, mln    3.317    -    3.347
08:55     Germany     Unemployment rate (February) seasonally unadjusted    7.9%    -    8.0 (7.9)%
09:00     EU(17)     PMI (February)    59.0    59.0    57.3
09:30     UK     CIPS manufacturing index (February)    61.5    61.7    62.0
09:30     UK     M4 money supply (January) final    0.8%    -    -1.3%
09:30     UK     M4 money supply (January) final Y/Y    -1.7%    -    -1.5%
09:30     UK     Consumer credit (January), bln     -0.3    0.2    0.8 (0.2)
10:00     Italy     CPI (February) preliminary    0.3%    0.2%    0.4%
10:00     Italy     CPI (February) preliminary Y/Y    2.4%    2.2%    2.1%
10:00     Italy     HICP (February) preliminary Y/Y    2.1%    2.0%    1.9%
10:00     EU(17)     Harmonized CPI (February) Y/Y preliminary    2.4%    2.4%    2.3%
10:00     EU(17)     Unemployment (January)    9.9%    10.0%    10.0%

The yen and the Swiss franc weakened as economic reports from Japan to Sweden added to signs the global recovery is gathering pace, damping demand for safer assets.
Japan’s currency fell as the European Commission raised its growth forecast for 2011 and said inflation may stay above the European Central Bank’s limit for most of the year, boosting the appeal of higher-yielding securities.
The euro extended yesterday’s advance versus the franc amid speculation ECB President Jean-Claude Trichet will signal this week that policy makers are ready to raise interest rates.
Gross domestic product in the euro region may increase 1.6% this year, above an earlier forecast of 1.5% growth, the European Commission said today. Inflation will average 2.2%, the agency forecast, up from a November estimate of 1.8%. Inflation in the 17- nation bloc quickened to 2.4% last month from 2.3% in January, the European Union’s statistics office said today in a preliminary estimate.
Australia’s dollar climbed for a third day against the Japanese unit as a government report showed retail sales gained 0.4% in January from a month earlier. That beat the 0.3% median forecast in a survey.

EUR/USD printed session high on $1.3854, but failed to go further and retreated to $1.3823.

GBP/USD fell to $1.6255 after testing highs around $1.6323.

USD/JPY slowly weakened from Y82.25 to Y82.02.


US data starts at 1500GMT, when Federal Reserve Chairman Ben Bernanke gives his semi-annual monetary policy report to the Senate Banking Committee in Washington.
US data also heats up at 1500GMT, when ISM manufacturing data is expected to fall to 60.5 in February.
At the same time, construction spending is expected to fall 0.8% in January following the residential-related plunge in December. Housing starts rose sharply in the month, suggesting that residential construction rebound in the month.