European Session – Pound strong, focus on UK budget
March 20, 2013 1:35 pm
The British pound was the biggest mover in the European session on Wednesday, outperforming against most major counterparts.
Sterling jumped higher against the dollar and euro after much better-than-expected UK employment data showed the lowest claimant count level since June 2011.
GBPUSD recovered losses made early in the London session when the pair fell to a low of $1.5026 and subsequently rose after the jobs data to $1.5144, higher than the session open price of $1.5088. EURGBP fell from a high of 0.8579 to 0.8524.
However the pound is vulnerable ahead of a key budget announcement by UK Chancellor of the Exchequer, George Osborne at 1230GMT. Osborne is expected to tweak the Bank of England remit and give it more leeway to stimulate growth.
Meanwhile, the concerns n the euro zone could support the pound in the near term as it will be in demand as a safe haven asset.
The euro strengthened from a four- month low against the dollar and gained for the first time in eight days versus the Swiss franc.
EURUSD tumbled 0.8 percent on Tuesday to $1.2843, the lowest since November 22 last year, and reversed those losses today, rising to $1.2950.
EURCHF rose to a high of 1.2232, moving off Monday’s low of 1.2167.
Focus will be on the Federal Reserve later today when the FOMC is expected to release a hawkish statement. Due to the recent series of US economic data being encouraging, the Fed is not likely to make any substantial changes to its FOMC statement.
Such optimism helped lift USDJPY to 95.63 from an intraday low of 94.81. EURJPY rose to 123.82 from 122.02. Japan is closed for a public holiday so volume is light.
The British pound was the biggest mover in the European session on Wednesday, outperforming against most major counterparts.
Sterling jumped higher against the dollar and euro after much better-than-expected UK employment data showed the lowest claimant count level since June 2011.
GBPUSD recovered losses made early in the London session when the pair fell to a low of $1.5026 and subsequently rose after the jobs data to $1.5144, higher than the session open price of $1.5088. EURGBP fell from a high of 0.8579 to 0.8524.
However the pound is vulnerable ahead of a key budget announcement by UK Chancellor of the Exchequer, George Osborne at 1230GMT. Osborne is expected to tweak the Bank of England remit and give it more leeway to stimulate growth.
Meanwhile, the concerns n the euro zone could support the pound in the near term as it will be in demand as a safe haven asset.
The euro strengthened from a four- month low against the dollar and gained for the first time in eight days versus the Swiss franc.
EURUSD tumbled 0.8 percent on Tuesday to $1.2843, the lowest since November 22 last year, and reversed those losses today, rising to $1.2950.
EURCHF rose to a high of 1.2232, moving off Monday’s low of 1.2167.
Focus will be on the Federal Reserve later today when the FOMC is expected to release a hawkish statement. Due to the recent series of US economic data being encouraging, the Fed is not likely to make any substantial changes to its FOMC statement.
Such optimism helped lift USDJPY to 95.63 from an intraday low of 94.81. EURJPY rose to 123.82 from 122.02. Japan is closed for a public holiday so volume is light.
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