European Session – Dollar gains on strong data, rising Fed tapering possibility
December 13, 2013 1:45 pm
The US dollar put in a strong performance during today’s European session, as traders bought the greenback on expectations that the Federal Reserve would taper its monthly bond purchases during its meeting next week.
Stronger-than-expected retail sales for November, as well as other recent data such as the employment report for November previously, made the case in favor of tapering stronger.
The euro fell 0.16% against the dollar to trade at 1.3729. The euro’s losses were moderated by news that a higher-than-expected 22.6 billion euros of long-term refinancing operations funding by the ECB would be repaid early from the banks that borrowed from this facility. This in turn meant that liquidity conditions in the Eurozone would become tighter.
The dollar was weaker against the yen, losing 0.20% to trade at 103.42, following an earlier 5-year high of 103.92 achieved during the Asian session.
According to commentators, the speed of the yen’s decline suggested that it might become once more the funding currency of choice for so-called carry trades that try to take advantage of yield differentials.
The pound dropped sharply against the dollar, falling by 0.47% to 1.6267, during a session where no important economic announcements were made.
The US dollar put in a strong performance during today’s European session, as traders bought the greenback on expectations that the Federal Reserve would taper its monthly bond purchases during its meeting next week.
Stronger-than-expected retail sales for November, as well as other recent data such as the employment report for November previously, made the case in favor of tapering stronger.
The euro fell 0.16% against the dollar to trade at 1.3729. The euro’s losses were moderated by news that a higher-than-expected 22.6 billion euros of long-term refinancing operations funding by the ECB would be repaid early from the banks that borrowed from this facility. This in turn meant that liquidity conditions in the Eurozone would become tighter.
The dollar was weaker against the yen, losing 0.20% to trade at 103.42, following an earlier 5-year high of 103.92 achieved during the Asian session.
According to commentators, the speed of the yen’s decline suggested that it might become once more the funding currency of choice for so-called carry trades that try to take advantage of yield differentials.
The pound dropped sharply against the dollar, falling by 0.47% to 1.6267, during a session where no important economic announcements were made.
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