EUR/USD closed in NY at $1.3310, off pullback lows of $1.3282 (seen after the ISDA decision on no credit event for Greek swaps). Rate edged higher in early Asian trade, the move influenced by EUR/JPY demand into the Tokyo fix, with rate touching a high of $1.3333 before momentum faltered in the cross and allowed EUR/USD to drift lower through the balance of the session. Rate posted lows at $1.32936 before settling around $1.3300 into early Europe. Release of disappointing German retail sales into early European dealing saw a slow initial negative reaction, but move lower gained pace as rate moved under the NY low. Bids in the $1.3270/65 held up the rate for a short while before another round of pressure took rate down to $1.3240. Move met macro and semi official demand into the deeper dip with rate recovering in late morning trade, though moves above $1.3260 proved laboured. The underlying tone remained very heavy, with recovery efforts continuing to be hampered by supply linked to Wednesday’s LTRO allotment.
EasyForexNews Research Team