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UFXBank Forex News: Pound Strengthens on Rise in Housing Prices

Written by article default Wednesday, 02 March 2011 08:02

USD Dollar (USD) – The Dollar rose against most of the major currencies in forex trading as investors preferred not to take a risk due to the unstable situation in North Africa. The ISM Manufacturing Index came out at 61.40, better than the expected 60.90. The Stock Markets in the U.S closed negative as the Dow Jones fell by 1.38% and the NASDAQ fell by 1.61%. Crude Oil once again reached a 2 year high at 100.66, closing above $100 at $100.55 a barrel. Gold (XAU) reached a new record and closed at $1431.20 an ounce. Today, Fed Chairman Bernanke is expected to testify, the beige book will be released, and the ADP Nonfarm Employment Change is expected at 163.00K vs. 187.00K previously.

Euro (EUR) – The euro fell versus the dollar as a result of a climb in crude oil prices as unrest threatened to spread to Saudi Arabia and Iran following turmoil in Libya .The unemployment rate came out at 9.90%, better than the expected 10.00%. The Euro couldn’t break the resistance level at 1.3850. Only breaching the resistance level of 1.3850 will push the pair higher, otherwise a rebound back to 1.37 zones is possible. Overall, EUR/USD traded with a low of 1.3762 and with a high of 1.3853. Today, the PPI is expected at 1.00% vs. 0.80% previously.

EUR/USD – Last:  1.3754

British Pound (GBP) – The pound strengthened to above 1.6300 for the first time since January 2010 after an unexpected rise in U.K. housing prices and manufacturing sentiment, which came in at a record high, boosted speculation that interest rates may rise. The Manufacturing PMI came out at 61.5 as expected. Only breaching the resistance level of 1.6300 again will push the pair higher, otherwise a rebound back to 1.62 zones is possible. Overall, GBP/USD traded with a low of 1.6251 and with a high of 1.6328. Today, no major economic data is expected.

GBP/USD - Last: 1.6234

Japanese Yen (JPY) – The dollar rose against the yen after good economic data from the U.S. was released. The Unemployment Rate came out at 4.90% as expected. Breaking the support level of 81.60 might extend the decline in the pair to 81.00 levels. Overall, USD/JPY traded with a low of 81.72 and with a high of 82.23. No major economic data is expected today.

USD/JPY-Last: 81.91

Canadian dollar (CAD) – Canada’s dollar fell from a three year high against the greenback after the Bank of Canada reiterated that a strong currency poses challenges to the nation’s exporters and thus, the BoC held its target lending rate at 1 percent. The interest rate came out at 1%, which is unchanged from before. Holding below the support level of 0.9770 might extend the decline in the pair. Overall, USD/CAD traded with a low of 0.9682 and with a high of 0.9754. Today, the Interest Rate Decision is expected unchanged at 1%. No major economic data is expected today.

USD/CAD - Last: 0.9755