2013-03-14 22:01 US Session – Euro recovers losses to rally versus dollar
March 14, 2013 10:01 pm
The euro moved off a three-month low against the dollar in Thursday’s US trading session. However the euro remains vulnerable as political uncertainty in Italy and a likely bailout for Cyprus should keep it under pressure.
Meanwhile, market focus is also in a two-day EU Summit in Brussels, where budget policies are to be discussed.
Dollar strength is expected to resume as the contrast between the economic recovery in the US and Europe is widening. Recent US data show an improving labour market and pick up in activity while data from the euro zone have been quite dismal recently.
After US data today showed new claims for unemployment benefits dropped for a third straight week last week, dollar was boosted brielfy. EURUSD dropped to a low of $1.2910, the lowest since December. However after such a sharp decline, the pair was due for a correction.
The euro moved back above the key $1.3000 level, and last traded at $1.3005, up 0.3 percent on the day.
Sterling produced a strong rally, up by over 1 percent to a session high of $1.5117, moving off a 2-1/2 year low of $ 1.4830 on March 12, the lowest since June 2010.
Again, the pound’s gain was not due to any fundamentals, but was lifted due to profit taking after such a huge decline, and some interest from long term buyers looking to get in cheap.
Focus will remain on the Bank Of England as it has a more accommodative policy stance compared to the Federal Reserve, and this is could weigh on the pound.
Dollar ended flat o the day against the yen. USDJPY fluctuated between 96.57 and 95.72 before ending at 96.09 yen. However expectations of aggressive policy easing from the Bank of Japan are expected to weigh on the yen in the longer term.
The euro moved off a three-month low against the dollar in Thursday’s US trading session. However the euro remains vulnerable as political uncertainty in Italy and a likely bailout for Cyprus should keep it under pressure.
Meanwhile, market focus is also in a two-day EU Summit in Brussels, where budget policies are to be discussed.
Dollar strength is expected to resume as the contrast between the economic recovery in the US and Europe is widening. Recent US data show an improving labour market and pick up in activity while data from the euro zone have been quite dismal recently.
After US data today showed new claims for unemployment benefits dropped for a third straight week last week, dollar was boosted brielfy. EURUSD dropped to a low of $1.2910, the lowest since December. However after such a sharp decline, the pair was due for a correction.
The euro moved back above the key $1.3000 level, and last traded at $1.3005, up 0.3 percent on the day.
Sterling produced a strong rally, up by over 1 percent to a session high of $1.5117, moving off a 2-1/2 year low of $ 1.4830 on March 12, the lowest since June 2010.
Again, the pound’s gain was not due to any fundamentals, but was lifted due to profit taking after such a huge decline, and some interest from long term buyers looking to get in cheap.
Focus will remain on the Bank Of England as it has a more accommodative policy stance compared to the Federal Reserve, and this is could weigh on the pound.
Dollar ended flat o the day against the yen. USDJPY fluctuated between 96.57 and 95.72 before ending at 96.09 yen. However expectations of aggressive policy easing from the Bank of Japan are expected to weigh on the yen in the longer term.
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