GBP: Opened early Europe at $1.5823, stg0.7923, GBP closed in NY at $1.5786, after rate had been pressured to lows of $1.5772 following the earlier rejection from $1.5875. Slow start in Asia with rate seen settled between early session lows of $1.5782 and $1.5790 before it picked up some better demand through the Asian afternoon that took it on to $1.5798 but momentum failed to extend move through $1.5800. Euro-sterling, which had seen lows Thursday of stg0.79025 consolidated between stg0.7917/0.79285 through Asia. Cable dipped to $1.5778 in early Europe as it tracked euro-dollar’s negative reaction to release of weak retail sales data, but demand quickly emerged, though failed again ahead of $1.5800. Strong euro recovery mid morning provided some lift to cable, allowing it to break and clear $1.5800, edging on to $1.5834, but move met headwind resistance as end month demand for euro-sterling overtook, taking the cross to stg0.7950. Cable settled around $1.5820 ahead of NY, while the cross held just off highs. Jackson Hole Symposium/end month flows to dictate direction this afternoon.
EUR: Opened early Europe at $1.2514, Euro-dollar closed in NY at $1.2506 after rate had eased away from intraday highs between $1.2560/64 to $1.2487, the move seemingly triggered by reported comments from Slovak PM Fico that a Eurozone break-up is equally possible as the alternative. Rate initially eased to $1.2502 in early Asia before picking up demand interest, the rate edging to $1.2521 where it met resistance, the overall tone of trade through the session described as subdued with market awaiting Fed Bernanke comments from today’s much awaited Jackson Hole Symposium. Release of weaker then forecast Germany retail sales data took rate down to $1.2494 in early Europe, with recovery initially seen laboured. Rate eventually edged to retest the overnight high with Asian sovereign demand emerging to provide an added boost, possibly linked to fix demand into 1000 London time. Rate pressured through Thursday’s highs extending on to begin challenge on stronger offers $1.2580/1.2600, the barrier at $1.2600 possibly the attraction ahead of Jackson Hole/end month flows.
YEN: Opened in early Europe around Y78.42 and Y98.13, Dollar-yen closed in NY at Y78.63, having recovered off session lows at Y78.494. Early Tokyo sold into this recovery with rate initially meeting support ahead of Y78.50 before breaking down to a low of Y78.40. Market was seemingly wary of reported ‘stealth’ demand interest from around Y78.45, reported over recent sessions, with market not willing to take rate below the Y78.40 level. Euro-yen closed in NY at Y98.35, off session lows of Y98.04, with rate squeezed back to Y98.06 in Asia as it took direction from euro-dollar and dollar-yen’s slippage in this session. Dollar-yen retained a heavy tone into early Europe, trade contained within Y78.40/45. Euro-yen dipped to Y97.99 on release of weak Germany ratail sales data, but quickly recovered backa bove the figure. Dollar-yen and euro-yen were both pressured higher mid-morning on reported Asian sovereign demand, possibly linked to end month flows, the move taking dollar-yen up to Y78.57, while euro-yen tracked euro-dollar, tripping CTA stops through Y98.50/60 to take it to Y98.77.
EasyForexNews Research Team