Closed in NY Friday at $1.3360 after rate had recovered off lows at $1.3307 on IMF Lagarde comments supporting the recent euro strengthening/yen weakening moves, the reactive demand taking the rate to highs of $1.3376 before drifting off into the close. Rate marked highs at $1.3365 into opening Asian trade Monday before squeezing lower as it reacted to strong demand for dollar-yen following the weekend G20 Communique (failed to criticise Japan directly for recent currency devaluation). The move lower in euro-dollar was cushioned in part by demand for euro-yen, the move up in the cross eventually allowing euro-dollar to recover $1.3345 into Europe. G20 effect expected to be seen into early Europe, but with US and Canada holidays today likely that markets will become subdued into the afternoon. EZ current account data at 0900GMT could provide some interest during the morning. For the week, Fed Minutes Wednesday seen as the next key release, with EZ flash PMI’s due Thursday and LTRO2 repayments for Friday to influence. Italian elections Feb24-25 also of interest. Euro-dollar offers $1.3365/80 ahead of $1.3400 (stops above). Support $1.3325/20, stops below.
EasyForexNews Research Team