• ECB’s Trichet: 2010 can be year of economic recovery. ECB has already taken many unconventional measures, studying whether room for additional measures. Not decided if current interest rates are the lowest possible.
• Swiss retail sales +1.2% y/y in January vs 3.6% rise in December
• Le Figaro: French economy may shrink 1.0% in Q-1 2009.
• Italian January industrial output -0.2% m/m (much better than median forecast of -2.5%) But Decembers data revised sharply downward, to -3.9% from initial -2.5%
• BOE minutes: MPC voted 9-0 for 50 bps rate cut, £75 bln QE programme
• UK February jobless claims soar to +138,400 (vs consensus 84,800) Januarys’ revised to +93,500 from initial +73,800. Unemployment rose to 6.5% from 6.3%, as expected.
• Main mover today has been cable. Had already lost over a big figure before the release of truly terrible jobs data. Started off around 1.4050 and was already down at 1.3930 just prior to the job data releases, as the market anticipated the worst. And they got it!!!, cable slumping to a post release low of 1.3848. Also weighing on cable was latest IMF revision to its economic forecasts. It expects UK economy to shrink 3.8% in 2009, the worst performance among major countries, apart from Japan. The IMF also sees UK GDP falling next year as well.
• EUR/USD came under fairly heavy pressure early, with Bank of China seen an active seller. But buying interest resurfaced on dip below 1.3000 and we’re back pretty much where we started. Reports have buy orders lined up at 1.2980.
• USD/JPY narrow rangebound. Interest seen lined up both sides of market. Buyers down at 98.30, sellers up at 98.90/00.