EUR – Was marked down into the Asian open, early Wellington opening around $1.2965 as market reacted to press articles concerning the knock on effect of the Portuguese court decision, but rate met decent demand in the dip to $1.2962 which took the it back above $1.3000 and on to $1.3006, the move aided by early demand for euro-yen out of Tokyo as the Japanese currency continued to soften following last week’s BOJ policy announcement. Rate settled between $1.2980/1.3000 through the balance of the session, trading around $1.2983 into Europe. Early pressure on euro-dollar eased rate to $1.2969 in Europe, but move was again cushioned by euro-yen demand, the buying of the cross took rate back to retest the overnight highs, breaking above and extending recovery to $1.3019. Rate faltered ahead of reported offers from $1.3020, easing back under $1.3000 in late morning trade.
GBP – Rate dipped to $1.5298 into opening Wellington trade, marked down in tandem with euro-dollar following weekend press reaction to the decision by the Portuguese constitutional court to reject part of the austerity plans, before it picked up fresh demand that edged it back to $1.5352. Rate then drifted off to $1.5320 into Europe. Euro-sterling, which had seen initial react highs of stg0.8517 on release of US data as cable lagged euro-dollar’s react, was pressed back to lows of stg0.8472 into the NY close on that sterling-yen demand. The cross edged to stg0.8478 in early Asian trade before pressing down to stg0.8464, recovering to stg0.8475 into Europe. Cable was pressed back to $1.5314 into early Europe, as it took early direction from euro-dollar, recovering to $1.5342. Euro-dollar’s break back above $1.3000, with euro-yen leading general euro demand, saw the cross edge to stg0.85045, which in turn weighed back on cable, taking it to $1.5301. Demand around $1.5300 cushioned the move though recovery attempts faltered above $1.5320
JPY – Dollar-yen continued the rally from Friday’s NY close, opening firmer in thin trade. Nikkei reported the BOJ is expected to kick-off its new monetary-easing program by buying a total of Y1.2tln this week, as well as suggesting MUFG is in advanced talks to buy Deutsche Bank’s US property loan arm for Y360bln, provided the fuel to take dollar-yen to Y98.85. Demand from a major US and European bank flushed stops on the move, before it consolidated around Y98.30/70. Euro-yen spiked to Y128.45, later settling around Y128.00. Risk sentiment continued in early Europe, dollar-yen extended the slow grind to Y98.65, before the rate stalled. Fresh demand from the crosses lifted through the Asian high, eventually taking out the Y99.00 barrier to highs of Y99.01. Euro-yen made a show above Y128.00 and extended to highs of Y128.84, before meeting strong resistance ahead of the Y129.00 barrier. Profit take sales added weight to Y128.35, dollar-yen Y98.70 ahead of NY.
EasyForexNews Research Team