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Morning Forex Review: EUR, GBP, USD
Written by article default Thursday, 18 November 2010 11:17
Coming Up Today* GBP Public Sector Net Borrowing (9:30)
* GBP Retail Sales m/m (9:30)
* USD Unemployment Claims (13:30)
* GBP MPC Member Posen Speaks (14:45)
* USD Philly Fed Manufacturing Index (15:00)
Asian equities have been in recovery mode on Thursday, after Wall Street finished flat on the previous session, and on the back of a softer greenback. Gold jumped by around 1% to nearly $1350 /oz, as a report on Wednesday showed that US core CPI remained stubbornly low. The Australian and New Zealand dollars were also on the rise on Thursday as some risk appetite appears to be returning back to the market. The Kiwi was also boosted by a higher inflation reported on New Zealand overnight.
EUR/USD
The pair was seeing gaining on Thursday, as the euro rebounded from a seven-week low against the dollar to trade higher, just a breath from 1.36. Despite a pending decision on the course of action to be taken, if any, to address the Irish debt problems, positive investor sentiment has been the dominant feature so far today. Furthermore, speculation about a potential bailout plan for Ireland to be announced within the next few days might provide some support for the common area currency.
Support/Resistance 1.3530/1.3640
GBP/USD
The Cable was stronger on Wednesday, after a report showed that jobless claims dropped more than expected. Furthermore, the release of the MPC Meeting Minutes showed that the BOE was still far from implementing more quantitative easing, as recent inflation reports showed to be persistently stronger. However, the pound has been an underperformer, relative to the euro, with the EUR/GBP rising by more than 0.4% on the session. Some analysts have noted the relatively bigger exposure of UK banks on Ireland.
Support/Resistance 1.5850/1.6050