EUR: Opened early Europe at $1.3104, Euro-dollar closed in NY at $1.3115 having pulled back from an extended recovery high of $1.3172 before pulling back to $1.3092 ahead of the close. Return of Japanese markets saw decent selling of euro-yen emerge as markets reacted to the closure of Japanese companies in China, due to the recent unrest, which weighed on Japanese equities. Euro-dollar eased from an early recovery high at $1.3119 to $1.3090. The move lower was also aided by the initial negative reaction of Aussie to RBA Minutes. However, the recovery in Aussie led euro-dollar to $1.3114 but momentum quickly faded and allowed for another drift off to the $1.3095/90 area. Rate had lifted back above $1.31 into early Europe but move met willing sellers which took rate down to retest NY lows at $1.3085/80. Strong demand was encountered which bounced rate to $1.3115 but again met headwind sales. Spanish comments pushed back hopes for bond aid and pressed rate down to $1.3065. Rate recovered to $1.3097 on talk of strong ZEW, only for rate to drop to $1.3070 on confirmation.
GBP: Opened early Europe at $1.6247, stg0.8065, GBP closed in NY at $1.6252 after rate had corrected back from $1.6273 to $1.6233 ahead of the close. Rate continued to squeeze lower into early Asia as rate took direction from euro-dollar which in turn was pressured down on early euro-yen sales as a returning Japanese market reacted to the closure of Japanese companies in China due to recent unrest. Cable eased to retest that NY pullback low but again met demand here before recovering to $1.6257. Rate then drifted off to $1.6240 ahead of the European open. Euro-sterling was contained within a tight stg0.8061/71 range overnight as rate consolidated its corrective pullback off Friday highs of stg0.8114. Despite early downside pressure, led by euro-dollar slippage, cable retained an underlying buoyant tone, the move below $1.6233 finding good support ahead of $1.6220, while euro-sterling eased into support between stg0.8060-50. Cable recovered to $1.6250 but late morning pressure on euro-dollar saw rate ease back to $1.6235/30, as the cross tempered pressure on broke below stg0.8050.
JPY: Opened in early Europe around Y78.64 and Y103.05, Yen crosses opened the Asian session heavy, a returning Japanese market taking advantage of Monday’s softening in the yen to sell back into dollar-yen and euro-yen. The anti-Japanese climate in China saw Japanese firms closing which in turn put downside pressure on Japanese equities which added weight into the open. Euro-yen pressed down from an early high at Y103.26 to Y102.78, while dollar-yen eased off from Y78.75 to Y78.48. Recovery in Japanese equities, on back of demand for tech industry and oil/gas companies, allowed yen pairs to pare losses with dollar-yen recovering to the Y78.70 area, while euro-yen made a show back above Y103.00 but the early general downside pressure on the euro into European dealing weighed back. Dollar-yen remained within a tight range around Y78.70 through the European morning, while euro-yen took direction from euro-dollar as this rate reflected the softer risk tone and allowed the cross to ease to Y102.75. Dollar-yen demand remains between Y78.50/30 with offers Y78.80/00.
EasyForexNews Research Team