EUR – Opened early Europe at $1.3000, Euro-dollar closed in NY at $1.3003 after easing off a session high of $1.3015. A fairly subdued trading session through Asia with the rate consolidating Tuesday’s recovery between $1.3000/14 for most of the session, making a late session low at $1.2997 before settling around $1.3000 ahead of the European open. This afternoon’s FOMC policy decision remains in focus, with Fiscal Cliff discussions continuing to bubble away in the background. Risk remains in favour and seen helping to buoy euro-dollar. An initial lift to $1.3010 into Europe was greeted by willing sellers that pressed rate to extended lows of $1.2995. Another recovery to $1.3010 and a pullback to the $1.2995 area eventually attracted stronger demand that lifted the rate on to trigger stops through $1.3015/25. Rate eased to $1.3011 into Eurozone IP data, the weak release prompting sales that were well covered by profit take buying. Rate recovered, challenging $1.3031 (61.8% $1.3127-1.2876) ahead of the NY open. General tone remains risk on ahead of NY.
GBP – Opened early Europe at $1.6112 and stg0.8067, GBP closed in NY at $1.6110 after the rate saw decent demand through Tuesday’s session that got it to an eventual high of $1.6122. Rate edged to $1.6120 in early Asia before momentum faded and it drifted off to $1.6108. Another rally to $1.6120 was again rebuffed with pullback this time extending overnight lows to $1.6105 before it settled between $1.6110/15 ahead of Europe. The move up in cable was seen on the coat tails of euro-dollar. Euro-sterling had extended its recovery to stg0.8077 Tuesday, consolidating this move in Asia between stg0.80675-0.80725. Cable was pressed down to $1.6095 in early Europe, as rate tracked early slippage in euro-dollar, but quickly recovered, extending recent highs to $1.6132 ahead of UK employment data. Rate was trading around $1.6120 on release, the as expected data providing a mild reaction before buying resumed (sovereign interest noted) and took rate on to $1.6148 before meeting decent offers placed into $1.6150. Rate was tradingt back at $1.6137 into NY with underlying buoyant tone in place.
JPY – Opened in early Europe at Y82.71 and Y107.57, Euro-yen led the overnight pressure on the yen with dollar-yen able to edge up from an early Y82.47 low to Y82.70 as the cross rallied from Y107.27 to Y107.51 on demand from offshore/retail names. Expectations of a LDP victory in the elections added to the mix, before it settled between Y107.40/50 ahead of the European open. Dollar-yen eased off its highs and settled between Y82.60/70 into Europe. Yen continued on the defensive as the dollar and euro extended gains throughout the European session. Dollar-yen took out technical levels and lifted to fresh 8 month highs of Y82.94, before the rate met strong resistance ahead of the Y83.00 barrier and eased to Y82.78. Late trade nudged higher to Y82.88 as dealers reported of large offers waiting on the platforms, 800mln to Y82.98, with a yard into Y83.00. Euro-yen mirrored the move and advanced to Y107.96, but again ran into strong supply ahead of the Y108.00 barrier. The underlying tone remains buoyant ahead of the NY open.
EasyForexNews Research Team