Closed in NY at $1.2435, after rate had spiked back from post US NFP initial react lows of $1.2288 to $1.2459. Rate dipped back to a registered Asian open of $1.2405 before quickly closing the gap as early market reacted to press reports suggesting Germany was softening its opposition toward European bonds/banking union (though this would come with European sovereignty provisos). Rate lifted to a high of $1.2443 before faltering, the corrective pullback given added weight as market then turned attention to an FT interview with the Cyprus cenbank governor in which he stated the country would seek EU aid if needed. Though not large (E1.8bln) it would provide another negative toward the euro. Rate squeezed to a session low of $1.2386 before recovering back to $1.2413 into early Europe. Focus this week will be on Fed Bernanke Thursday for any hint, or not, of QE3. ECB’s rate decision Thursday also of interest, most expecting no change in rates but could announce fresh LTRO operations. Bids seen into $1.2385 with stops noted through $1.2385/80. Offers $1.2440/50.
EasyForexNews Research Team