1. The strength US economy and its currency (USD) is strongly driven by employment, manufacturing and housing. Whilst there have been bright signs that employment and manufacturing are on the rebound, last week’s housing data put a bit of a dent on the overall recovery. There are some important economic indicators in the week ahead out of the US including Composite Home Price Index, US Consumer Board Confidence, US Richmond Fed Manufacturing Index as well as the final fourth quarter GDP estimate. 2. Understanding the dynamic between the Euro and the US Dollar these days, is like a necessary basic instinct for those watching and trading forex. This week gone by shows how the two major economies in contrast. US housing data although somewhat mixed, shows the US recovery as slow and steady, and Fed Chairman Ben Bernanke voices his confidence in the US banking sector's ability in taking the stress from the Euro zone crisis. 3. The rating agencies, Fitch, Moody’s and S&P were warned by the European Securities and Markets Authority (ESMA). Major releases from the UK are due at 09:30am GMT, the Bank of England (BOE) financial stability report and the mortgage approvals. Focus will be on the US new home sales at 14:00 GMT. EUR/USD is currently trading at 1.3236 after the French manufacturing sentiment posted an improved figure, rising to 96.
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