European Session – Euro rebounds on services PMI data
January 6, 2014 2:34 pm
The currency markets were dominated by risk aversion today as several key risk events are scheduled for this week – the Fed meeting minutes on Wednesday, European Central Bank and Bank of England policy meetings on Thursday and the all-important US nonfarm payrolls on Friday.
As a result, the yen as broadly stronger today due to safe haven demand flows, especially against the dollar and the euro. There was some relief for the euro during the European session though.
Better Euro zone PMI data for the service sector helped the euro recover some losses. The overall Eurozone head line PMI figure was unchanged as expected at 51.0 while strong readings from Spain and France helped offset weaker readings from Italy and Germany.
The euro rebounded from a 2-week low of 1.3570 reached in Asia today, to climb to a European Session high of 1.3621 following the PMI data. The euro ended the session with a 0.10% gains to 1.3598.
Against the yen, the euro bounced off a 3-week low of 141.48 to a session high of 142.39, and ended with a 0.35% gain to 142.26. Focus now turns to tomorrow’s Euro zone CPI data, which will be a key driver for the euro, followed by Thursday’s ECB rate announcement.
Sterling remained weak against the dollar today, reaching the lowest level this year so far at 1.6336 in early European session trading, following weaker-than-expected 58.8 UK service sector PMI. The forecast was for a reading of 60.0 in December.
The pound managed to recover by the session with a 0.12% gains to 1.6591. A major risk even for the pound will be Thursday’s Bank of England policy announcement.
The dollar was weak against the yen but made a modest recovery in the European session although traded within Friday’s range. The dollar ended the session at 104.61 with a 0.26% gain.
Key risk for the dollar will be Wednesday’s FOMC minutes and Friday’s nonfarm payrolls. Immediate focus will be on today’s US Senate vote on Janet Yellen as well as US ISM non-manufacturing data.
The currency markets were dominated by risk aversion today as several key risk events are scheduled for this week – the Fed meeting minutes on Wednesday, European Central Bank and Bank of England policy meetings on Thursday and the all-important US nonfarm payrolls on Friday.
As a result, the yen as broadly stronger today due to safe haven demand flows, especially against the dollar and the euro. There was some relief for the euro during the European session though.
Better Euro zone PMI data for the service sector helped the euro recover some losses. The overall Eurozone head line PMI figure was unchanged as expected at 51.0 while strong readings from Spain and France helped offset weaker readings from Italy and Germany.
The euro rebounded from a 2-week low of 1.3570 reached in Asia today, to climb to a European Session high of 1.3621 following the PMI data. The euro ended the session with a 0.10% gains to 1.3598.
Against the yen, the euro bounced off a 3-week low of 141.48 to a session high of 142.39, and ended with a 0.35% gain to 142.26. Focus now turns to tomorrow’s Euro zone CPI data, which will be a key driver for the euro, followed by Thursday’s ECB rate announcement.
Sterling remained weak against the dollar today, reaching the lowest level this year so far at 1.6336 in early European session trading, following weaker-than-expected 58.8 UK service sector PMI. The forecast was for a reading of 60.0 in December.
The pound managed to recover by the session with a 0.12% gains to 1.6591. A major risk even for the pound will be Thursday’s Bank of England policy announcement.
The dollar was weak against the yen but made a modest recovery in the European session although traded within Friday’s range. The dollar ended the session at 104.61 with a 0.26% gain.
Key risk for the dollar will be Wednesday’s FOMC minutes and Friday’s nonfarm payrolls. Immediate focus will be on today’s US Senate vote on Janet Yellen as well as US ISM non-manufacturing data.
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