The pair closed the NY session Wednesday at $1.2883, having recovered off an afternoon session low of $1.2847 (the rate having seen lows earlier in the day of $1.2843 after getting sold lower following the release of weaker than forecast Germany GDP data) to $1.2888 ahead of the close. Rate reversed tack into early Asia, the rate easing off to $1.2873 before bouncing up to $1.2889. Failure to push on toward $1.2900 prompted short term specs to cover back, the sales easing the rate to overnight lows of $1.2867 before it recovered to $1.2875 ahead of the European open. Offers remain in place to $1.2900 with talk of stops in place above. A break here though expected to meet decent supply from above $1.2925. Strong demand remains in place between $1.2850/40, with European corporate interest linked to this area. Focus this morning on EZ CPI and trade data at 0900GMT ahead of what appears could be an interesting afternoon. US CPI, weekly jobless claims and housing starts at 1230GMT, with ECB Draghi speaking in Turin at 1300GMT. Phila Fed follows at 1400GMT.
