EUR – Closed in NY at $1.2900 after rate had moved backwards and forwards through $1.2900 a few times during the session, though noted that each dip was a higher low and remained wary of the key support area of $1.2880/75. Rate lifted to $1.2906 in early Asia before turning lower, touching $1.2890 before it recovered through the mid part of the overnight session, edging to a high of $1.2924 before dropping sharply back to $1.2889 into Europe as market reacted to a Sarris comment that Cyprus has not received the requested Russian financial support. The dip below $1.2900 again drew corporate demand, which was linked to dip buys Thursday, the buys allowing rate to step its way to a recovery high of $1.2920. This recovery was tempered by position adjustment into Germany Ifo release, the rate easing to $1.2907 before dropping to $1.2894 as headline numbers came in weaker than forecast. However, corporate demand cushioned the move with the rate able to recover to $1.2920 then break Asian highs, triggered stops above $1.2925 edging it on to $1.2939. Cyprus developments remain the key driver into the critical weekend.
GBP – Closed in NY at $1.5174 after rate had been pulled back from a session high of $1.5210 to $1.5141 before recovering into the close. Rate touched an early low in Asia at $1.5167 before it pushed higher through the balance of the session to $1.5195, holding firm into Europe. Euro-sterling closed in NY at stg0.8501, the rate having seen lows of stg0.8490 before recovering to stg0.8530 then drifted off into the close. Early Asian trade was confined in a tight range around stg0.8500 before dropping to stg0.8484 as the euro was sold off into Europe on headlines suggesting Cyprus had not been able to negotiate funding from Russia. Cable nudged to an extended high of $1.5198 in opening Europe trade before easing off to $1.5178 as the cross recovered back above stg0.8500, the rate edging to stg0.85125 ahead of German Ifi data. Weak number saw the cross retreat lower, the move providing a lift for cable with move eventually breaking above $1.5200, then Thursday highs of $1.5210 to $1.5214. Momentum faded as take profit selling emerged, but was holding above $1.5200 late morning.
JPY – Dollar-yen lifted to Y95.11 in early Asia before it drifted back below the figure, dropping to Y94.55 as markets reacted to late Asia news suggesting that Cyprus had failed to secure requested Russian aid. Euro-yen led this late session move as the euro was sold off across the board, the cross printed lows of Y121.89 having fallen from Y122.70 earlier in the session. Risk appetite lifted the yen pairs to Y94.84/Y122.38 in early Europe before stalling on profit take sales. A fresh wave of supply in the euro crosses pressed through Y122.00, extending to Y121.74, before dip demand cushioned. Release of soft German IFO data added further weight to Y121.48, flushing stops on the move. Dollar-yen mirrored the cross and with supply from model names extended losses to Y94.20, before once again meeting willing buyers in the dip. The yen pairs later tracked euro-dollar’s extended recovery and settled around Y94.45/Y122.15 ahead of NY where headlines from Cyprus continue to dictate markets.
EasyForexNews Research Team