EUR/USD

High, But Not High Enough: Dollar fundamentals propelled the euro higher as the net foreign securities purchases data fell short of expectations.  Although rising above the consensus, the figure falls way short of the trade deficit witnessed last week, turning concern to the sustainability of the current pace in the world's largest economy.  Already higher off of the 1.1900 handle, the Euro climbed to above the 1.2000 figure even as no real data was scheduled in favor of the European nation.  The single piece of data expected was in line with expectations as consumer prices for the Italian economy rose 0.2 percent on the monthly measure.  Now with most of the U.S. event risk out of the way, players may be looking across the Atlantic for a reason to push the European single currency higher.  Expected for tomorrow are consumer prices for the region.  Estimated to rebound to a positive rise in the month, consumer price increases would indefinitely fuel further rate hikes as central bankers have shifted gears to a more tightening bias on higher energy concerns.  Should the figures fall short, traders will turn attention to the U.S. inflationary figure later in the day to initiated a pull back on the major pair.

NZD/USD

Traders Disregard Manufacturing Slowdown: Greenback data disseminated throughout the markets, even countering pessimistic data that was released in New Zealand.  According to a survey released by the Australian & New Zealand Banking Group Ltd., manufacturing activity slowed in the economy to a 44.1 reading from a December print of 47.6.  The lowest reading in the index since the beginning of the survey in 2002, the figure also suggests that future activity may contract as an appreciated domestic currency deterred global trade partners in new orders and increased the competitiveness of foreign imports in the month.  This makes for a better rate cut consideration case as central bankers look to revive lower productivity but still fear rampant inflation on higher consumer prices.  However, with the current funding, attributed to net foreign interest, to the downside and providing a shortfall against a trade deficit balloon, the kiwi looked for a better trade.  The sentiment turned more to higher interest rates as both economies look to sport a deficit equivalent to 7-8 percent of gross domestic product.

GBP/CHF

Bears Pound Sterling: Pound traders left the session as lower average earnings figures was reason enough to favor the Swiss franc counter.  With rates expected to rise in Switzerland, and a shift of tightening bias to subsequent economies forecasted, any reason to believe that rates may be lowered in the U.K. looks to spark a sell off in noted crosses.  According to the report, average earnings including bonuses fell 3.5 percent while remaining at 3.8 percent when excluding the bonus.  Simply, this means that with earnings on the presumable decline, consumers may be unwilling to spend.  As a result, further attention may be focused on consumer spending by central bankers when in conjunction with retail sales figures.  Although numbers have been rising, they are still historically low in comparison.  With that said, tomorrow's retail figures will play an increasingly large role in price action.  Declining last month, figures this time around are expected to rise, countering the earnings notions.

Richard Lee is a Currency Strategist at FXCM.