A gauge of German services fell to 49.9 in June, less than the earlier reading of 50.3, according to London-based Markit Economics, with a figure below 50 indicating contraction. Other reports showed euro-area services and manufacturing output declined for a fifth month and China's services expanded at the slowest pace in 10 months. ECB President Mario Draghi will probably cut the benchmark rate by a quarter-percentage point to 0.75 percent, according to the median forecast of economists in a Bloomberg survey.

“Slow growth dynamics and uncertainty are pressuring the euro,” said Gavin Friend, a London-based markets strategist at National Australia Bank Ltd. “The ECB will probably cut tomorrow. Draghi has hinted that an easing of policy is on the way. The euro will probably lag behind, with other currencies rallying more.”

Eoin Treacy's view My view - The pattern of the Eurozone's crisis to date is that the ECB has responded favourably to political initiatives designed to promote greater European integration. Therefore following last week's commitment to a banking union, it is to be expected that the ECB will make a gesture to help to support the flagging Eurozone economy.

German bund futures found support in the region of the upper side of the underlying trading range late last week and today rallied to break the very short-term progression of lower rally highs. A sustained move below 140 would now be required to question potential for some additional upside.