Treasury - Daily Forex for day 26.02.2007

The dollar fell to near six-week lows versus the euro on Friday as U.S. economic prospects lag behind those of the euro zone despite Friday's report showing worse-than-expected business sentiment in Germany. The Ifo business sentiment survey for February dropped to 107 from January's 107.9, while analysts had forecast a decline to 107.5.

The crown continued losing its ground against the euro on Friday, testing the weaker side of its recent range on expectations that the negative interest rate differential versus euro rates will widen further. Whereas the CNB is widely expected to keep rates on hold on March 1, the ECB will highly likely raise its main rate by 25 bps the week after.