European session:

The euro is headed for its biggest weekly drop against the dollar since January on speculation policy makers meeting today will struggle to agree on measures to combat the region’s debt crisis. The European leaders scheduled to meet in Brussels have set a March 25 deadline to approve a comprehensive package.
The European Union should set up a new agency to sell bonds on behalf of member countries and eventually issue European-wide debt, European Central Bank Executive Board member Lorenzo Bini Smaghi said today in Lucca, Italy.
The yen strengthened against all of its 16 major counterparts after an 8.9-magnitude earthquake struck the north coast of Japan, boosting domestic demand for the currency as a haven.
Japan’s currency rebounded versus the dollar after earlier weakening to a two-week low against its U.S. counterpart. A tsunami of more than 10 meters (33 feet) was reported in northern Japan and the quake registered 7 on the Japanese seismic scale, the highest level, in some areas north of Tokyo. The euro reached a one-week low against the dollar.
“The yen may be strengthening on some domestic repatriation of the currency,” said Jane Foley, a senior foreign-exchange strategist at Rabobank International in London. “The yen generally benefits in times of uncertainty created by natural disasters. The yen hasn’t fully given up its safe-haven status, despite the fact that Japan has been hit by this crisis.”
“Japanese investors are cutting back overseas risk,” said Neil Jones, head of European hedge-fund sales at Mizuho Corporate Bank Ltd. in London. “Overseas assets are being sold and the proceeds converted back into yen. Repatriation’s the key and is behind the stronger yen.”
“Natural disasters can have an inflationary impact,” Foley said. “As the rebuilding effort commences, growth may rebound significantly. Authorities have tried to create inflation in Japan for a couple of decades. If we did have inflation then this could set Bank of Japan policy back on a more normal route,” boosting the currency, she said.