Forex: Thursday’s review

Yesterday the euro strengthened  on speculation Greece will attract enough investors to make its debt-swap plan a success, adding to optimism the region’s debt crisis will be contained.

The common currency rose for a second day versus the dollar after the European Central Bank kept its benchmark interest rate unchanged and President Mario Draghi said recent surveys showed signs of economic stabilization.

The dollar had gained against most major currencies in the period as investors sought safety on concern the Greek debt swap might unravel.

Greece’s largest banks, most of the country’s pension funds, and more than 30 European banks and insurers including BNP Paribas SA, Commerzbank AG (CBK) and Assicurazioni Generali SpA (G) have agreed to the offer.

Speaking at a press conference in Frankfurt after the ECB meeting, Draghi said “the risk environment has improved enormously” and recent surveys “confirm signs of a stabilization” in the euro-area economy. The outlook is “still subject to downside risks,” he said. Policy makers didn’t discuss changing interest rates at their meeting, Draghi said.

The number of Americans filing claims for jobless benefits rose 8,000 to 362,000 last week, the Labor Department said, keeping the average over the past four weeks close to a four- year low. A report from the Department tomorrow will show that employers added 208,000 jobs last month, according to the median estimate of economists.

EUR/USD: yesterday the pair has grown come nearer to a level $1.33.

GBP/USD: yesterday the pair has grown, closed day above $1.58.

USD/JPY: yesterday the pair continued the rally.

European data starts at 0700GMT with Germany where the final HICP is expected to confirm the preliminary estimate, coming at the same time as labour costs and the trade balance. At 0745GMT, France releases industrial output. There are a series of UK data releases at 0930GMT, including quoted rates data from the Bank of England as well as producer prices, industrial production, manufacturing output, construction and also the BOE Gfk/NOP Inflation Expectations data. The main US labor market data is due at 1330GMT along with trade data and non-farm payrolls are forecast to rise 210,000 in February, continuing a trend of strong payrolls gain. The unemployment rate is

forecast to hold steady at 8.3%, but the range of forecasts is fairly wide. Hourly earnings are expected to rise 0.2%, while the average

workweek is forecast hold steady at 34.5 hours.