Upbeat economic data pointing to a continued recovery in Europe failed to buoy the beleaguered euro. In the face of figures pointing to improved confidence, a greater money supply and growing credit, the euro closed at $0.9061 from $0.9112 on Friday and at 58.03p against sterling from 57.86p.
Money supply data pointed to strong activity. The ECB's main measure, M3 accelerated to 6.5 per cent year-on-year in March from February's 6.1 per cent year on year.
The number contrasted with market expectations of a slowdown to 5.9 per cent year-on-year and well above the targeted pace of 4.5 per cent.
At the same time, credit growth to the private sector accelerated to 10.9 per cent year-on-year in March from February's 10.4 per cent.
In Ireland the figures were far higher. According to the latest data released by the Central Bank, credit at the end of March was accelerating at 34.7 per cent year-on-year compared with 34.8 per cent at the end of February.
At the same time mortgage lending grew by 2.3 per cent in March to a yearly total of 20.2 per cent, from 20.5 per cent a month earlier.
According to Mr Jim Power, chief economist at Bank of Ireland, the failure of the euro to capitalise on such figures underlines the lack of confidence in the currency. However, he added, it also underlined the fact that the weak euro was very good news for many of Europe's economies.
It is quite possible, he said, that Ireland was one of the few States where a weak euro was not good news, given the extent to which we were economic outliers. Yesterday's credit data confirmed the extent of the continuing boom in Ireland, particularly in housing.
It is likely that the ECB had some indications of March money and credit developments when it raised interest rates by a quarter of one percentage point last week.
According to Mr Power, there will be another rate rise in June with more to come later in the year.
Again underlining the buoyant euro economy was the purchasing managers' index (PMI) survey, which was consistent with the picture of strong growth and price risks and suggested that manufacturing activity continued to expand briskly. The April euro-zone PMI jumped to 60.7 (the highest level since the series started in June 1997), from 59.3 in March. All the components of the index - including output, orders and the employment assessment - were higher. With the exception of stocks, which are back to June 1998 levels, each component hit new records.
