European Session – Euro under pressure ahead of ECB meeting
July 2, 2013 12:08 pm
The euro is under pressure today after a series of headlines out of Europe dampened demand for the currency. Meanwhile expectations of Fed tapering stimulus kept dollar firm.
The single currency began to come under pressure late on Monday after Portugal’s Finance Minister Vitor Gaspar resigned late Monday, as the country’s budget deficit widened in the first quarter.
Other event risk came when Euro zone officials said today that Greece has three days to reach an agreement with its lender, the troika, in order to secure the next tranche of its bailout funding at a meeting of the Eurogroup of finance ministers next Monday.
In the meantime, investors are also weary of buying euro ahead of the European Central Bank meeting on Thursday, with President Mario Draghi likely to reiterate that monetary policy will stay accommodative.
This will contrast with plans by the U.S. Federal Reserve which is expected to begin to scale back its economy-boosting stimulus.
The euro is down 0.3 percent against the dollar, reaching a session low of $1.3017. Against the British pound, euro fell to a slow of 85.64 pence before recovering back to prior levels at 85.90 pence.
Sterling had a choppy session against the dollar, first rising early in the session after higher-than-expected data . A survey showed British business confidence was at its highest since 2007. However, lower-than-forecast construction PMI brought the pair back down.
GBPUSD hit a high of $1.5237 before coming under pressure to $1.5240.
Investors are being cautious head of a key Bank of England policy meeting later this week, which is the first for the new Governor, Mark Carney. The pound is likely to be weighed too by the prospects of the Fed tapering stimulus, which is keeping the dollar firm.
The dollar edged higher against the yen, with USDJPY hitting a fresh four-week high of 99.89 early in the European session. The pair extended gains from the Asian session when a rally in Tokyo stocks lifted market sentiment.
The Australian dollar underperformed, weakening sharply after the Reserve Bank of Australia announced earlier today that it held interest rates at a record low of 2.75 percent and signalled that there could be room for further cuts in the future. AUDUSD fell to a low of $0.9151 around where it hovered, down 0.9 percent on the day.
The euro is under pressure today after a series of headlines out of Europe dampened demand for the currency. Meanwhile expectations of Fed tapering stimulus kept dollar firm.
The single currency began to come under pressure late on Monday after Portugal’s Finance Minister Vitor Gaspar resigned late Monday, as the country’s budget deficit widened in the first quarter.
Other event risk came when Euro zone officials said today that Greece has three days to reach an agreement with its lender, the troika, in order to secure the next tranche of its bailout funding at a meeting of the Eurogroup of finance ministers next Monday.
In the meantime, investors are also weary of buying euro ahead of the European Central Bank meeting on Thursday, with President Mario Draghi likely to reiterate that monetary policy will stay accommodative.
This will contrast with plans by the U.S. Federal Reserve which is expected to begin to scale back its economy-boosting stimulus.
The euro is down 0.3 percent against the dollar, reaching a session low of $1.3017. Against the British pound, euro fell to a slow of 85.64 pence before recovering back to prior levels at 85.90 pence.
Sterling had a choppy session against the dollar, first rising early in the session after higher-than-expected data . A survey showed British business confidence was at its highest since 2007. However, lower-than-forecast construction PMI brought the pair back down.
GBPUSD hit a high of $1.5237 before coming under pressure to $1.5240.
Investors are being cautious head of a key Bank of England policy meeting later this week, which is the first for the new Governor, Mark Carney. The pound is likely to be weighed too by the prospects of the Fed tapering stimulus, which is keeping the dollar firm.
The dollar edged higher against the yen, with USDJPY hitting a fresh four-week high of 99.89 early in the European session. The pair extended gains from the Asian session when a rally in Tokyo stocks lifted market sentiment.
The Australian dollar underperformed, weakening sharply after the Reserve Bank of Australia announced earlier today that it held interest rates at a record low of 2.75 percent and signalled that there could be room for further cuts in the future. AUDUSD fell to a low of $0.9151 around where it hovered, down 0.9 percent on the day.
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