EUR: Opened early Europe at $1.3070, Euro-dollar closed in NY at $1.3046 after rate had recovered from extended pullback lows of $1.2993 to $1.3076. Rate drifted higher in early trade, lifting to session highs of $1.3059 as risk appetite was boosted on release of stronger than forecast NZ GDP. Rate reversed off highs as Japanese traders sold Aussie-yen, a reduction in China coal imports was seen as the catalyst for Aussie sales, along with a weak component of HSBC China PMI, the flow prompting euro-yen selling as stops sub Y102.10-00 were targeted. The break below Y102.00 took euro-dollar through stops at $1.3020 before finding support at $1.2997. Bids to $1.2990 provided a cushion and allowed for a recovery above $1.3000 into Europe. Pressure on the euro resumed into Europe with recovery efforts remaining shallow in the move down. Weak French PMI dropped rate to $1.2940, stronger German PMI countered to $1.2984. Weak EMU PMI weighed back before French and macro name sales hit a retreating market that dropped it initially to $1.2935 before extending to $1.2930.
GBP: Opened early Europe at $1.6202 and stg0.8026, GBP closed in NY at $1.6221 after rate had recovered off extended lows of $1.6185 to $1.6236. Rate stepped its way back up to that $1.6236 in early Asian trade, as risk was given an early boost on stronger than forecast NZ data. However, reports that coal imports to China fell, along with uninspiring HSBC China PMI data, prompted sales of Aussie which weighed back on the early risk sentiment. Cable tracked euro-dollar lower, trading to a session low of $1.6198, before settling around the figure into early Europe. Euro-sterling eased from early Asia highs of stg0.8045to stg0.80205 into Europe, with further pressure on the euro into this session taking cable back below $1.62 and through Wednesday’s lows at $1.6185. The deeper fall in euro-dollar took cable to lows of $1.6164 but buyers continued to greet dips in cable, while euro-sterling ground below stg0.8000, trading to a late morning low of stg0.7989 on reported French sales. UK retail sales, though weak, came in better the pre release rumours and provided sterling added support.
EasyForexNews Research Team