UK Consumer Inflation Expectations

The GBP gained mildly against the USD after the release of a slightly better than expected consumer inflation expectation which read 2.5% versus its prior reading of 2.4%.

ECB Monthly Bulletin

The following are statements released from the ECB’s monthly bulletin:

• Euro zone recovery has begun, but likely to be uneven.
• ECB believes risks are broadly balanced with persistent uncertainty.
• They will continue progressive ending of exceptional support measures.
• Abundant liquidity will be absorbed when the time is right.
• ECb says recovery remains on track.

EU’s Altafaj on the wires…

Making a speech in Brussels on the topic of Greece, the EU’s Altafaj noted that the EU is ready to act tomorrow if it is necessary and that “there is a Greek solution to the Greek problems”.

UK Manufacturing and Production

The GBP fell slightly after the release of worse than expected manufacturing and production out the UK.

• Industrial Production (m/m) - Survey: 0.3%   Actual: -0.4%   Prior: 0.5%
• Industrial Production (y/y) - Survey: -0.8%   Actual: -1.5%   Prior: -3.6%
• Manufacturing Production (m/m) - Survey: 0.2%   Actual: -0.9%   Prior: 0.9%
• Manufacturing Production (y/y) - Survey: 1.4%   Actual: -0.2%   Prior: -1.9%

Italian Industrial Production m/m

The market had a lack luster reaction to a much better than expected monthly industrial production number out of Itlay of 2.6%; forecast of 0.7% and prior showing of -0.7%. Currently the Eur/Usd trades at 1.3570.

German Trade Balance and CPI

The EUR made a new session low of 1.3576 against the USD after a much worse than expected January trade balance number out of Germany, despite final m/m CPI being slightly better than the prior month. The details of these releases are as follows:

• Trade Balance - Survey: 14.5B   Actual: 8.0B   Prior: 13.5B
• Final CPI (m/m) - Survey: 0.2%   Actual: 0.4%   Prior: 0.2%

UK Trade Balance

The GBP made a new session lows against the USD and the JPY and continued to move lower after the release of a worse than expected trade balance out of the UK which read -8.0B versus a forecast of -6.9B and -7.3B previous release.

Mundell on the wires…

Columbia professor Robert Mundell has made the following comments on Bloomberg television:

• Growth/stability pact not strong enough.
• There may not be a need for European monetary fund.
• EU could create a less formal way of dealing with crisis.
• Speculators are a big problem for Greece.
• IMF can be useful; EU wants to solve issue itself.
• Greece has to make the budget adjustments.
• Euro is “best thing” that has happened to Europe.
• Governments have to balance budgets.
• He doesn’t see a Euro area defaulting.

Although not related, as these comments were release, the EUR made a new session low of 1.3579.