[B]The Euro ended the day unchanged against the US dollar as EUR/JPY selling grappled the markets.
[/B]
[B]The Eurozone trade balance was narrower than expected due to a slowdown in import and export growth. There is no doubt that the Eurozone economy is becoming less immune to the slowdown in the US or globally for that matter, but the problems across the pond (in the US) is still more severe. Also, despite ECB member Mersch’s shift from hawkish to dovish yesterday, other members of the ECB remain hawkish. Today Liebscher said that the primary task for the central bank is to avert second-round inflation. Although their stubbornly hawkish stance should keep the Euro from falling severely, there are consequences. Airbus warned that orders for their aircrafts could fall 50 percent this year and even though they did not directly cite the Euro, we are sure that the currency’s strength and the global slowdown are the primary reasons for the company’s dire forecasts. We doubt that Airbus is the only company suffering from a strong currency and slower export demand. Meanwhile, the Swiss Franc is weaker across the board as the Swiss Investor Confidence index falls for the third month in a row. [/B]