European Session – Euro and pound drop as dollar rebounds, yen extends post-nfp gains
January 13, 2014 2:30 pm
The pound and the euro were the biggest losers of the European session as the dollar managed to reduce the pace of its decline after the weak employment report on Friday. The yen continued to make sharp gains against currencies that did particularly well against it during the previous year.
In this way, the euro dived against the yen, hitting more than a 1-month low as it fell below 141 to 140.76 – down 0.44%. On Friday’s US close, the euro was trading comfortably above 142. It should be remarked that the slide in euro/yen was not accompanied by any drop in global stocks but was probably the result of the buildup excessive speculative positions that had their stop losses triggered as a result of liquidations in dollar/yen.
The pound dropped sharply during today’s European trading. It fell 0.82% against the US dollar to trade at 1.6358 and was down a massive 1.10% against the yen to 168.76. The euro also gained against the pound, up 0.66% to trade at 0.8341.
Among the stories that weighed on the pound was that the UK Treasury would keep the responsibility for the servicing of all the British debt should Scotland decide in favor of independence in a referendum September.
Back to the US dollar, according to analysts, the weak employment report had challenged the prevailing market view that the US economy was gradually building momentum, which would in turn push the US dollar higher as the Fed tapers its monthly asset purchases. The result was some volatile moves.
Nevertheless, after Friday’s losses, the dollar rebounded somewhat against the euro during the session, as the euro dropped 0.18% against the greenback to trade at 1.3645. The dollar on the other hand made a 3 ½ – week low against the yen at 103.10. It fell 0.25% during the session to trade at 103.19.
Overall, the foreign exchange markets posted significant moves in the absence of fresh economic data. The market still mainly seemed to be digesting the significance of Friday’s weak employment numbers and moving against some of the extreme positioning by speculative yen shorts.
The pound and the euro were the biggest losers of the European session as the dollar managed to reduce the pace of its decline after the weak employment report on Friday. The yen continued to make sharp gains against currencies that did particularly well against it during the previous year.
In this way, the euro dived against the yen, hitting more than a 1-month low as it fell below 141 to 140.76 – down 0.44%. On Friday’s US close, the euro was trading comfortably above 142. It should be remarked that the slide in euro/yen was not accompanied by any drop in global stocks but was probably the result of the buildup excessive speculative positions that had their stop losses triggered as a result of liquidations in dollar/yen.
The pound dropped sharply during today’s European trading. It fell 0.82% against the US dollar to trade at 1.6358 and was down a massive 1.10% against the yen to 168.76. The euro also gained against the pound, up 0.66% to trade at 0.8341.
Among the stories that weighed on the pound was that the UK Treasury would keep the responsibility for the servicing of all the British debt should Scotland decide in favor of independence in a referendum September.
Back to the US dollar, according to analysts, the weak employment report had challenged the prevailing market view that the US economy was gradually building momentum, which would in turn push the US dollar higher as the Fed tapers its monthly asset purchases. The result was some volatile moves.
Nevertheless, after Friday’s losses, the dollar rebounded somewhat against the euro during the session, as the euro dropped 0.18% against the greenback to trade at 1.3645. The dollar on the other hand made a 3 ½ – week low against the yen at 103.10. It fell 0.25% during the session to trade at 103.19.
Overall, the foreign exchange markets posted significant moves in the absence of fresh economic data. The market still mainly seemed to be digesting the significance of Friday’s weak employment numbers and moving against some of the extreme positioning by speculative yen shorts.
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