As the single currency tested bids around the US$ 1.4570 level and was capped around the $1.4760 level. The common currency reached its lowest level since 14 February as traders continued to scale back their expectations concerning regarding eurozone interest rates, especially as EMU-15 economic data continue to weaken. Data released in the U.S. today saw July new home sales climb2.4% to an annualized 515,000 rate, following yesterday’s existing home sales data. Second, the August Richmond Fed manufacturing index remained steady at -16. Third,August consumer confidence index climbed to 56.9 from 51.9. Many recent U.S. economic data have been improving and stabilizing in part, a stark contrast to what is happening in the eurozone. Other data saw the S&P/ Case-Shiller U.S. national home price index register a record 15.4% decline y/y in Q2, worse than the 14.2% decline in Q1. In eurozone news, the German Ifo business climate index fell to 94.8 in July from 97.5, a three-year low. Also, the September GfK consumer confidence index declined to a five-year low with the consumer climate index falling to 1.5 from a downwardly revised 1.9 in August. The weaker eurozone data suggest the European Central Bank may be forced to reduce eurozone interest rates sooner rather than later. Other data saw final Q2 gross domestic product off 0.5% q/q, its first decline in four years. Euro bids are cited around the US$ 1.4315 level.
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