Euro - European Markets

The euro has gained against US currency today at a rate of 1.47 in a session high. This occured before a report forecast to show German industrial output rose for a second month, boosting demand for higher-yielding assets.

European markets are going through considerable advances on Thursday following a positive start of U.S. earnings season and further advance on basic resources. Today the ECB will release the interest rate decision expected to remain at 1%. German industrial production is expected to rise by 1.9% vs. -0.9% prior.

Pound Sterling - UK markets

The pound strengthened against the US currency after UK consumer confidence rose to its highest level in 18 months. Stretching above 1.60 having rebound from Wednesday's low at 1.58, the pound's advance is dependant on the outcome of today's interest rate decision which is expected to remain at 0.5%.
However, support levels lie below 1.60 at 1.59 and a break below this level could lead to a further descent.

US Dollar - US Markets

The dollar dropped toward a 2-week low against the euro as signs the global economy is rebounding fuelled demand for higher-yielding assets. US currency weakened against 15 of its 16 most-traded counterparts as Asian stocks advanced and there are expectations that the European Central Bank will today refrain from lowering interest rates amid signs the global economy is recovering.

The dollar traded at $1.47 against the euro from $1.46 yesterday, having depreciated earlier this week on concern that the Federal Reserve will be slower to raise interest rates than policy makers in other nations. According to analysts' forecasts, The Federal Reserve may start raising its benchmark rate in the 3rd quarter of 2010. The dollar could be the funding currency of choice for carry trades due to expectations that U.S. Interest rates will stay low as the economy tries to revive itself.

Other Currencies - Highlights

The Australian dollar has rallied today, as employment data came in significantly better than was previously expected. The Aussie dollar was trading up more than 1% from Wednesday at 90.21 U.S. cents, rising above 90 cents for the first time since August 2008.

Elsewhere, the Japanese yen rose against all 16 major currencies on speculation foreign investors will buy Japanese equities. The yen rose to the highest level in more than a week against the US dollar. Wednesday's eight-month low of 88.01 yen is the most immediate target, and a break below would bring January's 13-year low of 87.10 yen into view as traders gauge how far and how quickly Japan's Ministry of Finance will let the yen strengthen.

The dollar versus Swiss franc pair climbed but was below the key resistance at 1.03 keeping the trend to the downside. All eyes remain fixed on today's European Central Bank and Bank of England meetings.