The EUR lost ground to the USD on Wednesday and this came about without little in the way of data from Europe. The Final Services PMI was released yesterday and it did come in with a slightly disappointing reading of 55.8 compared to the estimate of 56.0 however, investors probably gave this mark about half a minute worth of consideration. The EUR has essentially been trading based on risk sentiment and this is not about to change anytime soon. The ECB holds its monetary policy meeting and press conference today. President Claude Trichet will take the podium and answer questions regarding the health of the E.U. economy and he will do his best to put a positive spin on details. Having run the gauntlet of the Sovereign Debt crisis, Trichet should be well practiced by now to stay away from comments that will harm investor confidence. What may prove harder to answer for Trichet could come from questions about the European Banking Stress Test, nevertheless it can be assumed the ECB President has practiced his responses for this type of grilling. The EUR did trade slightly weaker yesterday, but this was after a good stretch of gains. The next two days of trading could provide some interesting movement for the Single Currency.
Written by bforex.com