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Forex pairs in this Article » EUR/USD (Barcelona) - Kit Juckes, Global Head of Currency Strategy at Societe Generale comments that the ECB lending survey makes him feel uncomfortable due to the effective tightening in ECB monetary policy that has come about as a result of the ECB's balance sheet shrinking to its smallest size since February 2012, which in turn has taken 2-yr Euro swap rates to their highest levels since last July.

He writes, "Bids for the ECB's 3-month repo totalled Eur 3.7bn. We've also seen a 0.7% fall in Spanish Q4 GDP ( a lot worse without the help of net exports, presumably). EC confidence data were better, but the euro is being propelled higher by monetary conditions at a time when the economy needs a weaker currency. So we go up (to EURUSD 1.37 next, 1.40 possibly) and then down later. And the Euro will be well supported within Europe."
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