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The euro rose to a one-week high against the yen in Asia Monday.
Written by article default Monday, 26 April 2010 08:35
Market OverviewThe euro rose to a one-week high against the yen in Asia Monday as Japanese financial institutions and Asian short-term investors bought the common currency amid growing speculation that fiscally troubled Greece may soon receive financial support. After the country formally requested aid Friday through a joint European Union-International Monetary Fund mechanism, Greek Finance Minister George Papaconstantinou said Sunday that funds should be available by early May. The common currency rose to YEN126.30 in morning trade in Tokyo, its highest since April 16. At 0450 GMT, it stood at YEN125.80 from YEN125.78 late Friday in New York. The ICE Dollar Index, which tracks the greenback against a trade-weighted basket of currencies, was at 81.433 at 0450 GMT from 81.413 late Friday in New York. The Euro was well supported when Greece Activated its Aid package in Early Europe although initial gains were limited and the market waited for supportive comments from France and Germany before pushing higher into the US close. April IFO was very strong at 101.6 vs. 98.8 expected. Sterling weakened against the US dollar and retreated from a three-month high against the euro as UK first quarter GDP data came in weaker than expected and reports Greece was about to accept aid helped the single currency. The Australian dollar rose to 19-month high against the yen at YEN87.62, while the British pound marked a three-month high at YEN145.72.
Market expectation
The euro and pound are rising against the dollar and yen as markets continue to react positively to the Greece aid request. The dollar also rose against the yen, marking a fresh three-week high at YEN94.37. The U.S. unit could rise to YEN94.50 later in the global day, some dealers said. Other dealers echoed that view, saying higher U.S. Treasury yields following strong housing data Friday would buoy the U.S. unit, though selling by Japanese exporters around YEN94.50 should keep it below that level for now. EURCHF is set to remain supported in the next few weeks, with the SNB likely to nudge the cross higher if the need arises, major banks say. European stock markets are expected to open higher Monday, with a firmer session overnight in Asian markets offering support, as global investors continue to react positively to Greece's move to request help from the European Union and the International Monetary Fund. The Australian currency could climb to JPY88.00 and the pound to YEN146.00 before profit-taking caps further gains, dealers said.