EUR: Opened early Europe at $1.2822, Euro-dollar closed in NY Friday at $1.2860 after rate had been pressed down from $1.2940 to $1.2838 on end month fix flows. Slow start into Asia with China, HK, Korea and Australia closed. A weak opening for Asian equities, along with negative comments from the Slovak PM Fico concerning Greek membership of EMU, provided early risk aversion, with sales gaining momentum as Tokyo opened. Triggered stops through $1.2825 (200-dma $1.2824) took rate to session lows of $1.2804, meeting reported Asian sovereign buys ahead of $1.2800. Rate settled above $1.2820 ahead of the European open. Asian reserve demand into Europe was cited for the recovery extension, with semi official buys through $1.2840/45 adding to the upside pressure. European corporates provided an ongoing demand interest, with the move up boosted in turn by release of slightly stronger than forecast Eurozone manufacturing PMI data. Rate touched a high of $1.2908 late morning, with a corrective pull back viewed loathe to ease back under $1.2900.
GBP: Opened early Europe at $1.6130 and stg0.7949, GBP closed in NY Friday $1.6167 after getting pressed down from $1.6217 to $1.6114 on end of month dollar demand fix flows. Rate had eased off to $1.6147 into early Asian trade, with early demand lifting rate to $1.6161 before turning lower on slight risk aversion caused by a negative opening in Asian equities. The move lower was led by euro-dollar, though as cable trailed the move allowed euro-sterling to ease from stg0.7962 to stg0.7942 before settling around stg0.7950. Cable eased through the NY low at $1.6114 to $1.6109 as market probed for stops. Buyers emerged into the dip to allow rate to settle back around $1.6130 into Europe. Cable proved reluctant to track euro-dollar’s stronger recovery, allowing the cross to push up to stg0.7988 through European morning trade, whilst cable managed to push to $1.6169 before momentum waned. Release of weaker than forecast UK manufacturing PMI data added further negative weight on sterling which kept the cross buoyed, though cable was able to hold off overnight lows.
JPY: Opened in early Europe at Y77.87 and Y99.91 Dollar-yen touched an early Asian high of Y78.10 before steadilly sliding lower in an otherwise subdued session (China, HK, Korea and Australia closed), the rate touching an overnight low at Y77.865 and holding heavy into early Europe. Euro-yen eased back below Y100.00 in early trade, before settling between Y99.80/95. Dollar-yen headed lower in Early Europe to Y77.79, before support in the dip recovered. Sharp euro-dollar demand aided by better then expected PMI mfg eurozone data led the charge and dragged the dollar to Y77.90, extending to Y78.01. Profit take sales eased, before a fresh wave of demand lifted back to Y78.03 ahead of NY. The cross made a show through Y100.00 in early dealings as risk sentiment took hold of markets, extending to Y100.30 where the rate stalled. Strong German bank demand in euro-dollar gave the pair a further boost to Y100.70, later easing to Y100.60 where the underlying tone remains buoyant.
EasyForexNews Research Team