EUR – Closed in NY Monday at $1.3100 after pivoting around this level within a $1.3077- 1.3117 range. Euro-dollar has been basically sidelined in recent sessions with Thursday’s ECB rate decision in focus, though this event surrounded by key data from Europe and the US. This sidelining continued through the overnight Asian session with trade contained within $1.3084-1.3103, opening Europe around $1.3094. Rate spiked up to $1.3121 in opening European trade, the move triggering stops above $1.3115 but upside momentum quickly faded with rate moving back below the figure before breaking below its Asian base and on to $1.3067. Recovery to $1.3089 met headwind sell interest that pressed the rate to extended lows of $1.3055 ahead of release of key EZ CPI data. The low 1.2% release, as well as EZ unemployment edging up to 12.1%, has put market on a stronger outlook footing for a possible rate cut at Thursday’s meeting. However, react sales were met by stronger European corporate demand which cushioned the selling and took rate back to $1.3075/80. US Chicago Report and Consumer Confidence the next data focus at 1345-1400GMT respectively. End month flows tending to also add negative weight on the euro.
GBP – Closed in NY at $1.5500 after the pound pared early European gains, the rate having seen an extended recovery $1.5548 before sinking back to $1.5484 in NY before recovering into the close. Cable came under further pressure into Asia with the release of a weaker UK GfK survey providing added weight as rate dipped under the NY low to $1.5476. Cable recovered through the Asian afternoon, edging on to $1.5497 ahead of Europe. Euro-sterling reflected this softening in sterling, the rate having recovered off early lows Monday at stg0.8406 to stg0.8458 in NY, with Asia keeping up the pressure, extending the topside to stg0.8462 into Europe. This move in euro-sterling was influenced by a sharp spike higher in euro-dollar, the move also taking cable to $1.5507, with the corrective pullback in euro-dollar then outpacing cable it took euro-sterling through Asian lows while cable had a more steady easing. However, cable eased to extended lows of $1.5467 before stronger buying emerged, taking the rate back to the $1.5500 area. Euro-sterling was pressed to lows of stg0.8425 on soft EZ CPI data, recovering to stg0.8435 late morning, which provided cable added buoyancy.
JPY – Closed in NY at Y97.77, the rate having recovered off earlier lows of Y97.35 to Y98.20 before drifting off into the close. Rate picked up a bid tone into early Asia, with offers placed into Y98.00 providing the initial resistance before hedge fund and Asian demand emerged lifting to Y98.13. The pair stalled on profit take sales, exporter supply added weight taking the rate to Y97.80. This move allowed euro-yen to trigger stops above Y128.25, providing momentum to Y128.46, later easing to settle between Y128.10/35. Dollar-yen extended the slow grind to Y97.67 in early Europe and with volumes continuing light the pair was tied to a narrow 20 pip trading range. Rate tracked sharp cross slippage on release of soft eurozone inflation data, pressing the rate to Y97.59, before support ahead of Y97.50 cushioned. Euro-yen slipped to Y127.78 in early Europe, before the cross bounced to make a show back above Y128.00, recovery attempts continued shallow, sentiment turned and the rate soon eased to Y127.80 ahead of EZ inflation data. On release, euro-yen flushed stops to print lows of Y127.44, before recovering with euro-dollar to Y127.80. Late trade saw the yen pairs sit heavy at Y127.55/Y97.55.
EasyForexNews Research Team