European Session – Euro steady on expectations of Eurogroup deal with Greece
July 8, 2013 11:57 am
The euro moved off seven – week lows against the dollar despite a broadly stronger greenback after Friday’s upbeat nonfarm payrolls report. After a strong rally following the release of the jobs data, the dollar was due for a pullback, giving some relief for the euro’s decline.
There was some mixed data from the Euro zone today, mostly negative especially from Germany, Europe’s largest economy. Germany’s trade balance in May fell by more than expected, as a result of a decline in exports.
Meanwhile German industrial production numbers also disappointed, down 1.0 percent versus the previous month’s gains of 2.00 percent. Adding to the negative news, Euro zone investor sentiment report showed pessimism for the euro area economic recovery.
Despite the string of negative headlines, the euro was able to hold its ground, mainly being helped by optimism for a positive outcome at the Eurogroup meeting today, with regards to Greece. Expectations are that aid disbursement to Greece is likely, and that a deal will be reached by the Euro zone finance ministers to inject Greece with another 6.3 billion euros, and another 1.8 billion euros to follow from the IMF.
There was also some easing of concerns of the Euro zone dent crisis after news over the weekend there have been efforts to calm Portugal’s political crisis.
EURUSD moved slightly off a seven week low of $1.2805 reached on Friday after being pressured by a stronger dollar following the upbeat US jobs data. The euro edged up to a European session high of $1.2859.
GBPUSD has traded the day so far within a small 60-pip range, capped below $1.4912, close to a four-month low. The pound has had little respite due to expectations of more quantitative easing by the Bank of England, as was signalled by the BOE statement after a policy meeting last week.
USDJPY pulled back slightly from a one-and-a-half month high, due for a correction after a strong rally on Friday following the US nonfarm payrolls data. The pair last traded around 101.20 in the European session, having hit an earlier peak of 101.52 yen in the Asian session.
Dollar is expected to remain strong due to expectations that the Fed will begin to taper stimulus as soon as September.
The euro moved off seven – week lows against the dollar despite a broadly stronger greenback after Friday’s upbeat nonfarm payrolls report.
After a strong rally following the release of the jobs data, the dollar was due for a pullback, giving some relief for the euro’s decline.
There was some mixed data from the Euro zone today, mostly negative especially from Germany, Europe’s largest economy. Germany’s trade balance in May fell by more than expected, as a result of a decline in exports.
Meanwhile German industrial production numbers also disappointed, down 1.0 percent versus the previous month’s gains of 2.00 percent. Adding to the negative news, Euro zone investor sentiment report showed pessimism for the euro area economic recovery.
Despite the string of negative headlines, the euro was able to hold its ground, mainly being helped by optimism for a positive outcome at the Eurogroup meeting today, with regards to Greece. Expectations are that aid disbursement to Greece is likely, and that a deal will be reached by the Euro zone finance ministers to inject Greece with another 6.3 billion euros, and another 1.8 billion euros to follow from the IMF.
There was also some easing of concerns of the Euro zone dent crisis after news over the weekend there have been efforts to calm Portugal’s political crisis.
EURUSD moved slightly off a seven week low of $1.2805 reached on Friday after being pressured by a stronger dollar following the upbeat US jobs data. The euro edged up to a European session high of $1.2859.
GBPUSD has traded the day so far within a small 60-pip range, capped below $1.4912, close to a four-month low. The pound has had little respite due to expectations of more quantitative easing by the Bank of England, as was signalled by the BOE statement after a policy meeting last week.
USDJPY pulled back slightly from a one-and-a-half month high, due for a correction after a strong rally on Friday following the US nonfarm payrolls data. The pair last traded around 101.20 in the European session, having hit an earlier peak of 101.52 yen in the Asian session.
Dollar is expected to remain strong due to expectations that the Fed will begin to taper stimulus as soon as September.
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