By Vicki Schmelzer

NEW YORK (MNI) - Speculative accounts built a new record net euro short position and trimmed their net yen long position as per March 9, according to data released late Friday by the U.S. Commodity Futures Trading Commission.

By Vicki Schmelzer

NEW YORK (MNI) - Speculative accounts built a new record net euro short position and trimmed their net yen long position as per March 9, according to data released late Friday by the U.S. Commodity Futures Trading Commission.

STANFORD, California (MNI) - A delayed withdrawal of European Central Bank measures used to boost lending during the financial crisis would distort market behaviour and lead to a misallocation of credit, European Central Bank President Jean-Claude Trichet said on Friday.

The ECB considers the current pace of withdrawal "appropriate," he added.

By Vicki Schmelzer

NEW YORK (MNI) - Speculative accounts built a new record net euro short position and trimmed their net yen long position as per March 9, according to data released late Friday by the U.S. Commodity Futures Trading Commission.

BRUSSELS (MNI) - New rules to regulate the E2 trillion hedge funds and alternative investment industry are set to be thrashed out at a meeting of European Union finance ministers here Tuesday.

An agreement is likely, EU diplomats said, because the proposals will be decided by a qualified majority and no country has power of veto over the final decision. But there is likely to be a heated debate over the rules, which some countries say contravene the EU's single market principles.

LONDON (MNI) - Risk rally has seen the curve flatten today as the US dollar is sold across the board.

Big moves higher in euro, sterling and Swiss against the dollar has seen vols tumble.

Traders report there has been a big buyer of 1 week 1.3900 calls in euro-dollar - the amount said to be around 700 million euros. The 1-month ATM cable vol is down to 11.40 from 11.70.

BRUSSELS (MNI) - The European Commission is in line with other European leaders - including German Chancellor Angela Merkel - on the need to mitigate the impact of trading in credit default swaps (CDS) on government bonds, a spokesperson said on Friday.

Earlier this week, European Commission President Jose Manuel Barroso said the EU's executive arm would issue legislative proposals "before the summer" to increase transparency and limit risks in the derivatives market.

He also said a "new 'ad hoc' reflection is needed on Credit Default Swaps regarding sovereign debt."

BRUSSELS (MNI) - New European rules on alternative investments - including hedgefunds - being developed at the moment aren't intended to be protectionist, a European Commission spokesperson said on Friday.

The proposals are set to be discussed by European Union finance ministers at their regular meeting in Brussels next week but are set for complicated negotiations because some delegations want stricter controls than others.