Treasury - Daily Forex for day 08.06.2005

With the absence of any market-moving economic data on Monday, the dollar traded barely changed against the euro, around 100 points below an eight-month high of $1.2157 hit last week. The sentiment towards the euro, however, remains bearish. European Central Bank Chief Economist Otmar Issing said the policy strategy of the bank did not rule out an interest rate lowering. Furthermore, U.K. Foreign Secretary Jack Straw reported that a referendum on the new European constitution had been suspended in Great Britain, raising doubts on further European integration after France and the Netherlands rejected the constitution in referenda last week.

The Czech crown closed Monday's trading flat against the euro after climbing to three-week highs earlier in the session. The currency was underpinned by a rise in other regional currencies and favourable balance of payments data for the first quarter. The current account posted a surplus of 14.6 billion crowns after 36.1 billion crown deficit in the fourth quarter. The market focus is now turning to May CPI and unemployment data due out on Wednesday and first-quarter GDP growth due for release on Thursday.