EU session review: Euro drops before ECB's Trichet press-conference

Data released:
08:30     UK     Industrial production (May)    0.9%    1.1%    -1.7%
08:30     UK     Industrial production (May) Y/Y    -0.8%    -0.5%    -1.2%
08:30     UK     Manufacturing output (May)    1.8%    1.0%    -1.5%
08:30     UK     Manufacturing output (May) Y/Y    2.8%    2.1%    1.3%
10:00     Germany     Industrial production (May) seasonally adjusted    1.2%    0.9%    -0.8 (-0.6)%
10:00     Germany     Industrial production (May) not seasonally adjusted, workday adjusted Y/Y    7.6%    -    9.3 (9.6)%
11:00     UK     BoE meeting announcement    0.50%    0.50%    0.50%

The euro touched a one-week low as concern that Greece may become the currency region’s first default outweighed prospects for higher interest rates from the European Central Bank.
The euro holds tight as investors considered whether ECB President Jean-Claude Trichet will comment on the central bank’s acceptance of Greek debt as loan collateral in the event of a default. The ECB raised its key rate 25 basis points to 1.5%, as expected.
Today’s conference is “about what the ECB says about rate hikes going forward,” said Paul Robson, a senior foreign-exchange strategist at Royal Bank of Scotland Group Plc. “If they say risks to inflation and growth have moved to the downside, the euro would be quite vulnerable. Euro-dollar has had a very tight correlation with rate spreads over the last year, and that’s set to continue.”
The pound slipped against the greenback as the Bank of England left its key rate at a record-low 0.5%. The U.K. central bank also held its bond-purchase program at 200 billion pounds.
The Swiss franc weakened after a report showed inflation accelerated less than expected in June led by higher costs for energy. Consumer prices increased 0.6% from a year earlier, after rising 0.4% in May. Economists had forecast an inflation rate of 0.7%.

EUR/USD printed session high on $1.4350 before held within the range, limited by $1.4270/$1.4320. Later rate resumed decline to $1.4250.
GBP/USD failed to set above $1.6000 and retreated to below the figure - now at $1.5970.

USD/JPY rose to Y80.12 following some consolidation between Y80.90/Y81.00.

The ECB President Jean-Claude Trichet conference is due at 1230GMT.
At 1215GMT, the ADP National Employment Report is due. Last month the unexpectedly soft reading caused some to revise their estimates
lower. The lackluster 54,000 increase in non-farm payrolls justified the  revision. At 1230GMT, initial jobless claims are expecting toll to 420,000 in the July 2 week. Claims have been above 420,000 since the April 30 week. In the July 25 week, a labor analyst said there no special factors
contributing to the decline of 1,000 claims.