Spot was depressed below 1.30 into European trading butthe Euro has been supported on dips ahead of the ECB meeting. Russian EUR sales have weighed on EUR/USD but bids into the 1.2980 area have propped and with the pair carving a 1.2980/3000 short-term range ahead of the verdict the stops seen tight below remain intact for the moment.
These orders are seen around 1.2975 & sub-1.2970 and any triggering of these will increase S/T follow-through sales. Looking ahead, the ECB gives us their verdict on Euro Zone rates at 12:45 GMT. IFR still expect Euro Zone rates to be unchanged (3.5%) and they are aligned with the broader market in this outlook. At the accompanying press conference (after 13:30 GMT) the ECB President, Trichet, is expected to use his favored buzz-word; "vigilance".
Dealers will watch for this word as a signal for furtherhikes and therefore any uttering of such a phrase will be seen to be Euro supportive.Deeper into the North American session and US weekly numbers are early risk withonly the December wholesale numbers to follow (15:00 GMT).
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