Slow recovery continues as market.......>

EURO-DOLLAR: Slow recovery continues as market continues to tentatively move

back into risk. Rate extended its correction away from recent lows of $1.2241 to

$1.2462 in NY Monday ($1.2461 76.4% $1.2555-1.2155) before pulling back to

$1.2444 into the close. Demand in Asia, aided by a softening in the Jpy, saw

rate edge back to $1.2458 in early trade before rate settled around $1.2450 into

Europe. Spain CPI at 0700GMT(market median 0.3%mm/1.4%yy), EZ M3 at 0800GMT then

EZ Consumer Confidence at 0900GMT provide the morning's data interest, with US

Consumer Confidence seen as the main interest in an otherwise second tier data

day. Risk remains the main driver. Month-end approaching and initial model

projections seen suggest decent Usd demand. Resistance seen between $1.2460/70,

a break to expose $1.2500. A break above this latter level could prompt ECB

officials to comment on the strength of the single currency.