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Currencies Update: Dollar little changed before US industrial production
Written by article default Tuesday, 16 November 2010 06:29
The US dollar was traded close to its opening price versus a basket of major currencies as depicted by the dollar index ahead of the release of industrial production report which is expected to show improvement.The dollar index is currently trading at 78.55 after touching a high of 78.75 and a low of 78.30.
Later in the day, US industrial production is expected to jump to 0.3% in October from -0.2% in September, following the 0.2% rise in retail sales yesterday, which provided evidence the economy is recovering.
On the other hand, the euro managed to rebound, paring some of its losses after upbeat German Zew survey figures which showed that current situation index rose to 81.5 in November from the prior 72.6 and forecasts of 75.0 while economic sentiment index climbed to 1.8 relative to the preceding -7.2 and forecasts of -6.0.
Yet, the euro remains under pressure before euro area finance ministers meeting later in today in Brussels to discuss the Irish debt crisis and how to reach a permanent system that stands against future crisis after the expiry of the 75.0 billion-euro lifeline in 2013.
Speculations are increasing before the meeting that European leaders will fail to reach an agreement over the Irish imbalanced finances due to differences in point of views between Germany and other members.
Concerning the euro-dollar pair, it rebounded from its drop on the daily basis after getting support at 1.3580 levels which pushed the pair higher to hit a high of 1.3655, while the lowest point touched was at 1.3558.
The pair is currently trading at 1.3620, whereas the trading range for today is among the major support at 1.3500 and the major resistance at 1.3760.
Moving to the royal pair, it slipped for the second day, yet it gained support at 1.60 psychological level which pushed the pair higher.
Today, inflation continued its rally as to arch 3.2%, forcing Mervyn King to send the fourth open letter to the Chancellor of the Exchequer to discuss why inflation is still above the upper limit. The data raise concerns that inflation will remain above the target for longer while which may curb consumer spending.
So far, the pair is trading at 1.6002 after recording a high of 1.6084 and a low of 1.5978, while the trading range for today is among the major support at 1.5835 and the major resistance at 1.6205.
With regard to the dollar-yen pair, it eased its gains after the dollar had reached five-week high against the yen in the absence of important data from Asia.
Currently, the pair is trading at 83.07, reaching a high of 83.32 and a low of 82.83, while the trading range for today is among the major support at 81.95 and the major resistance at 84.00.