Treasury - Daily Forex for day 26.05.2005

With U.S. economic data having little impact on the markets, the dollar was pushed slightly lower against the euro by technical factors. U.S. durable goods report showed the orders jumped 1.9% in April after a revised drop of 1.6% in the previous month. The market had forecast a 1.0% increase. However, the dollar strengthened against the yen after a Chinese trade official said the country did not plan to revalue the yuan in the near-term. This afternoon the market will look at the release of preliminary first-quarter U.S. GDP growth. The economists expect the growth to be revised upwards to 3.6% from the initial 3.1% reading.

The Czech unit extended its drop versus the euro yesterday, approaching the level of 30.60. The crown seems still suffering from a sell-off of emerging market currencies and expectations of profit repatriation. The key focus today is on CNB's monthly monetary policy meeting.