Euro Remains Weak Ahead of GDP Report

The euro remained weaker against the Japanese yen and the Swiss franc today, though retained its gains against the US dollar, as today’s report is expected to confirm that the eurozone economy shrank last quarter.
The preliminary data showed that the eurozone gross domestic product contracted 0.3 percent in the fourth quarter of 2011. Analysts expect that the report today will confirm the preliminary figure. All in all, it looks like the rally of the shared European currency ended, at least in the short-term perspective.
Marito Ueda, a senior managing director in Tokyo at FX Prime Corp., voiced his negative opinion about the prospects for the euro:

Buying the euro makes no sense. The European Central Bank is tied up with tackling the region’s sovereign-debt problem and has no room left to bolster the economy through monetary policy.

EUR/USD traded at 1.3209 as of 3:05 GMT today after rising from 1.3193 to 1.3217 yesterday. EUR/JPY fell from 107.78 to 107.55 and EUR/CHF declined from 1.2056 to 1.2054 following yesterday’s drop from 1.2063 to 1.2059.

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