EUR has broken out over $1.3800 this morning against USD with gains accelerating in the minutes after ECB President Draghi’s press conference started. The central bank maintained its benchmark interest rate at 0.25% ignoring calls from some quarters (affectionately known as dreamland) for a rate cut or use of unconventional measures. At the press conference, President Draghi indicated the recovery continues and raised the ECB’s 2014 GDP growth forecast to 1.2% from 1.1% with growth expected to accelerate to 1.5% in 2015 and 1.8% in 2016. Inflation is also expected to pick up from 1.0-1.1% this year to 1.5% in 2016. Predictably he indicated he expects rates to remain low for some time but with the street looking for more stimulus, policy neutrality has actually come off as more hawkish than expected, boosting the common currency against both USD and GBP as the Bank of England also stood pat. While EUR has been gaining ground, the top performers in FX markets today have been AUD and NZD, boosted by very strong Australian retail sales and trade numbers. These, combined with yesterday’s positive Australian GDP report indicate an improving economy, reducing the need for the RBA to cut rates any time soon. Australian stocks finished slightly down on the day as stimulus speculation receded. With sentiment toward the global economy improving, stock markets in the US and Europe have been trading slightly higher, attracting some of the capital that continues to flow out of defensive havens like gold, JPY and CHF. Crude oil and gasoline have been falling again as tensions in the Ukraine continue to ease for now. It’s important not to get too complacent though as this crisis appears far from over. Today, Crimea’s parliament unanimously voted to join Russia and has scheduled a referendum on whether or not to leave Ukraine or join Russia for March 16th, the same day that the Sochi Paralympics end, suggesting March 17th as a day it could all flare up again. Corporate News Costco $1.05 vs street $1.17, Feb same store sales 2.0% vs street 2.6% Staples $0.33 vs street $0.38, Q4 same store sales (7.0%) vs street (2.8%), launches $500 million cost savings program, 225 stores to close by end 2015 Canadian Natural adj EPS $0.52 in line, GAAP EPS $0.38 vs street $0.55, raises dividend 12.5% Economic News Economic reports released overnight and this morning include: The PBOC has drained another CNY 93B in emergency liquidity from its financial system as the recent crisis fades. China’s Finance Minister indicated that 7.2% or 7.3% growth this year would be considered to be close enough to the 7.5% hard target outlined earlier this week. UK monetary policy decision 0.50% and £375B QE no change as expected ECB monetary policy decision 0.25% no change as expected US jobless claims 323K vs street 336K and previous 349K Australia retail sales 1.2% vs street 0.4% Australia trade balance $1.4B vs street $100M NZ house prices 9.3% vs street 9.6% France unemployment rate 10.2% vs street 11.0% UK Halifax house prices 7.9% vs street 7.3% Greece unemployment rate 27.5% vs previous 28.0% Germany factory orders 8.4% vs street 7.5% Economic reports due later today include: 10:00 am EST US factory orders street (0.5%) 10:00 am EST Canada Ivey PMI street 53.1 vs previous 56.8 10:30 am EST US natural gas storage street (137 BCF)

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