EUR: Opened early Europe at $1.2900, Euro-dollar closed in NY at $1.2886 after rate had seen extended highs of $1.29395, off earlier Asian lows of $1.2804, with rate edging off initial pullback lows of $1.2877 into the close. Rate bobbed above session lows of $1.2884 through early Asia before rate picked up demand via euro crosses, the rate edging to highs of $1.2905 before settling above $1.2900 ahead of the RBA rate decision. The 25bp cut surprised some, the react sell off in Aussie-dollar pressed euro-dollar back to retest the $1.2884 session lows before settling back around $1.2900 ahead of the European open. Early demand into Europe lifted rate up to $1.2918 before momentum faded, with US name sales cited for pressing rate back below $1.2900. Rate traded to a low of $1.2880 before meeting semi official demand which bounced rate back above the figure. Late morning demand extended recovery highs to $1.2920, but again move met headwind resistance from offers placed between $1.2920/25. Rate retained an underlying buoyant tone ahead of the NY open.
GBP: Opened early Europe at $1.6150 and stg0.7988, GBP closed in NY at $1.6133 after correcting back from extended recovery highs of $1.6175 to late session lows of $1.6122. Rate opened Asia pivoting the $1.6130 level, dipped to $1.6125 before recovering to an initial high of $1.6140. Announcement by the RBA to cut rates 25bp dropped rate back to $1.6130 where strong demand emerged to pressure the rate to $1.6159 into the European open. Euro-sterling opened Asia around stg0.7988 before slowly clawing higher as traders positioned for stops above stg0.8005 (Monday highs). However, recovery faltered above stg0.7997 before dropping to retest opening lows during the volatile reaction to the RBA decision. Cable picked up a bid tone in early Europe, edged to $1.6163 (76.4% $1.6175-22) and was rebuffed as Nationwide house price data disappointed. Rate slowly eased to $1.6137 before real money demand lifted it back to the $1.6150/60 area. Talk of RHS interest to be seen at today’s fix in the cross provided some counter but rate was able to extend move to $1.6170 late morning.
JPY: Opened in early Europe at Y78.06 and Y100.80, demand for Aussie-yen by Japanese accounts provided the early lift in Asia to settle the rate above Y78.00, the rate edging on to Y78.16 before getting a late knock back to Y78.05 after the RBA cut Australian interest rates. Demand for euro-yen provided added buoyancy into the pullback, as this rate extended recovery to Y100.87, after the initial rise to Y100.85 was knocked back to Y100.62 following the RBA move. Dollar-yen opened flat in Europe with trade stuck in a tight Y78.01-08 range, before sharp cross demand lifted to Y78.15. Rate extended through resistance to Y78.21 and remains in risk-on mode ahead of NY. Euro-yen opened heavy and tracked euro-dollar slippage through the Asian low to Y100.48. Semi-official demand in the dip led the recovery to Y100.70 where the rate stalled and consolidated gains. A fresh wave of demand from US names extended through Y101.00 to Y101.06, flushing stops on the move. Profit take sales eased however the underlying tone remains buoyant with offers reported at Y101.20, stronger behind at Y101.50.
EasyForexNews Research Team