Asian session: The euro was 0.3 percent from a two-week low against the greenback

00:30 Australia RBA Monetary Policy Statement Quarter I

01:00 U.S. FOMC Member Charles Evans Speaks -

02:30 China Trade Balance, bln January 31.6 24.3 29.2

05:00 Japan Eco Watchers Survey: Current January 45.8 48.2 49.5

05:00 Japan Eco Watchers Survey: Outlook January 51.0 56.5

05:30 China CPI y/y January +2.5% +2.1% +2.0%

05:30 China PPI y/y January -1.9% -1.6% -1.6%

The euro was poised for its biggest five-day drop in seven months after European Central Bank President Mario Draghi said recent currency gains may slow inflation and growth, damping demand for the region’s assets. There are downside risks to inflation “stemming from weaker economic activity and, more recently, the appreciation of the euro exchange rate,” according to a statement of Draghi’s remarks yesterday placed on the ECB’s website. The central bank kept its benchmark rate at a record-low 0.75 percent as forecast by economists in a Bloomberg News.

The 17-nation currency was 0.3 percent from a two-week low against the greenback as European Union leaders meet to seek agreement on the 2014-2020 budget. A promised EU investment budget to modernize the recession- hit economy is set to be scaled back amid competing national demands. A summit deadlock over the 2014-2020 budget would hobble subsidy programs, force the EU to fall back to annual budget extensions and add to concerns about Europe’s political cohesion.

New Zealand’s dollar climbed after data showed exports and imports in China, the South Pacific nation’s second-largest trading partner, rose more than economists forecast.

The yen is set for an unprecedented 13th weekly drop versus the U.S. dollar as Japan posted back-to-back monthly current account deficits for the first time since 1981.

EUR/USD: during the Asian session, the pair rose to $1.3415.

GBP/USD: during the Asian session, the pair rose to $1.5740.

USD/JPY: during the Asian session the pair fell below Y93.50.

With the central bank meetings for the week out of the way, the calendar starts to slow Friday, although there are releases on both sides of the  Atlantic. At 0700GMT, the German December trade numbers are set for release. French data is due for release at 0730GMT, when the January Bank of France business survey will be released. This will be followed by the release of the French January manufacturing investment survey at 0745GMT. From 0800GMT, senior politicians will begin to gather in Brussels for the EU leaders summit to discuss European Budget.