Closed in NY Thursday at $1.3187 after recovering off a late NY extended low of $1.3162. Rate continued this correction to $1.3195 in opening Asian dealing before dropping back to mark the overnight lows at $1.3183. Demand quickly emerged into the dip, with the initial upside push getting the rate to $1.3206. A brief drift to $1.3195 picked up fresh demand that then lifted the rate on to a high of $1.3219. Rate then settled between $1.3205/20 ahead of the European open. Friday brings Germany Ifo data at 0900GMT, of note after Tuesday’s positive ZEW reading but followed by flash PMI’s that disappointed Thursday. The key data of the day seen at 1100GMT when the ECB announces LTRO2 repayments, market expecting around E120-125bln and will gauge reaction if amount misses this area. Italian elections still loom for this weekend with performance of Berlusconi the active factor. Ther morning’s releases are followed by a very light US calendar, though expect some position adjustments into the weekend. Large $1.3200 strike maturities for the NY cut could act as an anchor until the interest rolls off. Offers $1.3220/30 with stops above the NY high at $1.3232, but offers noted into $1.3250. Bids $1.3160-30.
EasyForexNews Research Team