The euro began its descent at around 9am in London, falling as much as 88 pips to reach $1.2939 by 12:30pm (London time) as talk about the ECB opposing a restructuring of Greek bonds continued to fuel anxiety.

Unidentified sources told Bloomberg News that the ECB faces pressure to join private-sector investors in taking losses on Greek securities. However, the central bank is reluctant with the current arrangement because it believes that such a move will damage confidence in the institution. At this juncture it is beginning to feel as if every step forward is countered with two steps back. The euro slipped today despite an upbeat German IFO confidence reading, which rose to 108.3 from 107.3 in December.

At face value the IFO data suggests that Europe’s biggest economy may avoid a hard landing, although instinct tells me that it is still too premature to be making such assumptions. Over the past week, the euro has encountered resistance around the 50-day exponential moving average of $1.30, and the trend so far continues to suggest that the trajectory for EUR/USD remains bearish.