• China Vice Gov PBOC Hu: China’s monetary policy remains appropriately easy. Should be a steady supply of money and credit. Goal this year is for more balanced lending
  • Shanghai share index up 1.4% after central bank comments
  • China Vice Minister Liu: Should keep major currencies stable since financial crisis not over yet. As a responsible nation, China must maintain stable yuan
  • Japan PM Hatoyama: All-out effort needed to beat deflation. Must stimulate domestic demand
  • French March consumer confidence worsens to -34 from -33 in February, below median forecast -32
  • New BOJ board member Miyao: Will maintain very easy monetary policy
  • Merkel: Pleased with outcome of talks on support mechanism. Important that euro remains stable
  • Russia Central Bank cuts benchmark refi rate 25 bps to 8.25%, 12th cut in a year
  • UK Q4 revised business investment -4.3% q/q, -23.5% y/y from previous -5.8% q/q, -24.1% y/y
  • Moody’s: New ECB collateral rules reduce liquidity risk for Greece. Market reaction to support package is key to determine Greece credit question
  • Greek 5 year CDS narrows to 299 bps from 311 at New York close Thursday
  • EU’s Tajani: Does not see other worrying signals from other EU countries after Greece
  • ECB’s Constancio: Re IMF participation in any Greece aid package says “I think IMF is not necessary and should not have a role.”
  • Swiss KOF institute raises Swiss 2010 growth forecast to 1.7% from previous 0.6%, 2011 forecast to 2.2% from previous about 1.5%

Good morning for euro, extending it’s overnight Asian rally. EUR/USD up at 1.3395 from early 1.3340, EUR/JPY up at 123.90 from 123.40, EUR/GBP up at .9012 from .8975. Traders noted change in tone from ECB’s Trichet. Having yesterday said IMF involvement in Greek aid package was “very very bad” the official followed up saying he is extraordinarily happy that euro zone countries have found a workable solution. And I thought I had mood swings!!

The EUR/USD rally accelerated amid talk of hedge fund purchases, tripping stops above 1.3350 and getting all the way to session high 1.3408 so far. Also talk of strong Middle Eastern buying and buying from French auto company. . Comment from ECB’s Constancio (see above) disparaging IMF involvement in Greek aid package coincided with the session high, but didn’t cause much of a sell-off.

Cable at 1.4865 effectively unchanged on the day as is USD/JPY at 90.55.

Commodity currencies aussie and canadian loonie have given some ground, victims of euro cross unwinding. AUD/USD is down at .9075 from early .9105, while USD/CAD is up at 1.0255 from early 1.0210.