European focus: market awaits Trichet's speech [E]

The euro was little changed versus main currencies before the ECB's
decision on interest rates.
Despite, there are no doubts the interest rate will remain at a level
2.75%, and the market shows interest for a press conference by bank
President Jean-Claude Trichet. It will start after the ECB's decision.
ECB President may signal the central bank will boost the rate at the
next meeting.
During last month at least 6 ECB officials hinted at continuation of
monetary policy's toughening in their speeches. Besides, some officials
didn't exclude acceleration of interest rates hike to contain inflation.
Moreover, Wednesday's data showed services industries in the euro
region expanded the most in six years in June. A similar gauge of
manufacturing showed the fastest growth since August 2000.
Data testify business improves in Europe and economy also can sustains
toughening of credit policy.
``The market is waiting for Trichet's press conference, which is
likely to be on the hawkish side,'' said Niels Christensen, a currency
strategist at Societe Generale SA. ``The euro will be well supported today
by expectations of further ECB rate hikes this year,'' said Masashi
Kurabe, a senior currency manager at Bank of Tokyo-Mitsubishi UFJ Ltd.
``Any hawkish comments to contain inflation, such as the word `vigilance,'
may push up the euro,'' - assumed expert.
Europe's single currency may rise today to $1.2760 against the dollar
and Y147.50 versus the yen, Kurabe said.
Remind, Trichet last used the word ``vigilant'' to prepare markets for
a June 8 rate increase.