Closed in NY at $1.2285, off traded lows of $1.2260, with rate under pressure into early Asian trade as traders marked the rate lower on reaction to weaker than expected Chinese inflation data and today’s Eurogroup expectations dampened by Finland’s comments Friday
highlighting the ongoing political divide. Press reports suggesting Ireland’s debt could peak at 120%/GDP next year (tipping economy back into recession) and the Italian economy could shrink by 2.0%, also weighed. Rate officially opened at $1.2255 before stops below $1.2250 were targeted and triggered which took rate to extended lows of $1.2225 but reported option linked demand cushioned the move. Talk in Asia of barriers at $1.2220 and $1.2200 , as well as a EUR/AUD barrier at A$1.2000. Rate recovered, the move up boosted at the Tokyo open as bids emerged around Y97.50 in EUR/JPY, taking the rate above $1.2280 and on to session highs of $1.22965. Rate settled between $1.2280/$1.2300 ahead of the European open. Germany trade data due at 0600GMT in an otherwise data light day. Headlines from today’s Eurogroup to drive.
EasyForexNews Research Team