European Session – Euro falls; focus is on Eurogroup meeting
April 12, 2013 2:04 pm
Currency markets in the European Session had the Friday cautious mood and investors were favouring risk aversion, driving weakness in risk currencies like euro. Therefore, this helped buoy the US dollar which was broadly stronger, except against the yen.
There was an absence of tier one economic data today during the European session, nothing that was worth moving markets. In early US session, US retail sales numbers were released, missing estimates.
Retail sales in March fell unexpectedly the most in nine months as a result of slowing employment in the US. This reduced household income and consequently led to a reduction on consumer spending. Sales dropped 0.4 percent, which is the biggest drop since June, followed a 1 percent gain in February.
EURUSD declined 0.2 to $1.3039 as weekend risk resulted in position squaring. A Eurogroup meeting and EU finance meeting is currently being held in Dublin. Investors are watching for any news that develop from these meetings.
Sterling followed the main market mood. GBPUSD fell to a low of $1.5342.
Yen regained losses from yesterday. USDJPY failed to break above the key 100 yen level and fell to as low as 98.85 yen.
There is speculation that the Bank of Japan will increase its inflation forecast in its policy statement due on April 26. This as well as risk appetite and rising JGB 10‐year bond yields have all helped support yen today.
Aussie remained weak and failed to move back up to yesterday’s 3-month high of $1.0581, weighed down by broad US dollar strength.
Meanwhile, Australia’s Prime Minister Julia Gillard’s comments that the budget allows scope for RBA rate cut also weighed on AUDUSD, which fell to a low of $1.0514.
Currency markets in the European Session had the Friday cautious mood and investors were favouring risk aversion, driving weakness in risk currencies like euro. Therefore, this helped buoy the US dollar which was broadly stronger, except against the yen.
There was an absence of tier one economic data today during the European session, nothing that was worth moving markets. In early US session, US retail sales numbers were released, missing estimates.
Retail sales in March fell unexpectedly the most in nine months as a result of slowing employment in the US. This reduced household income and consequently led to a reduction on consumer spending. Sales dropped 0.4 percent, which is the biggest drop since June, followed a 1 percent gain in February.
EURUSD declined 0.2 to $1.3039 as weekend risk resulted in position squaring. A Eurogroup meeting and EU finance meeting is currently being held in Dublin. Investors are watching for any news that develop from these meetings.
Sterling followed the main market mood. GBPUSD fell to a low of $1.5342.
Yen regained losses from yesterday. USDJPY failed to break above the key 100 yen level and fell to as low as 98.85 yen.
There is speculation that the Bank of Japan will increase its inflation forecast in its policy statement due on April 26. This as well as risk appetite and rising JGB 10‐year bond yields have all helped support yen today.
Aussie remained weak and failed to move back up to yesterday’s 3-month high of $1.0581, weighed down by broad US dollar strength.
Meanwhile, Australia’s Prime Minister Julia Gillard’s comments that the budget allows scope for RBA rate cut also weighed on AUDUSD, which fell to a low of $1.0514.
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