EUR/USD (a 4-hour chart)
On the eve of the U.S. currency weakened significantly versus the euro and the pound and strengthened its position versus the Japanese yen. Mario Draghi has become a major news maker of the last week. ECB President said many times to the market, that there was no threat of deflation and therefore no need in further mitigate of monetary policy.
At the same time on Monday March 3, Draghi outlined the current CPI level as a negative for future economic growth in the Eurozone. There also has been and increased GDP growth estimation in 2014 from 1.1% to 1.2%, which cheered the "bulls" to open long positions. According to Friday the pair GBP/USD added 0.2%. In the midst of the European trading session the Bank of England results were published. All landmarks to tighten the monetary policy have been shown a long time ago and the market reaction to this event was negligible.
The USA released a weak report on factory orders – the index fell by 0.7% in January, that adds optimism to "bulls”. Another negative release from the U.S. shows, that GDP growth in the first quarter of world's largest economy will be worse than investors expected in late 2013.
The futures growth on stock index Nikkei 225 supported the demand for USD/JPY pair throughout the day. The correlation between the two instruments is still very high and the lack of interest on the background of macroeconomic reports from Japan and the U.S. - investors were buying the U.S. dollar.