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UFXBank Forex News: Euro Drops as Recovery Concerns Resurface

Written by article default Wednesday, 09 March 2011 09:43

USD Dollar (USD) –The Dollar rose versus most of the other major currencies in Forex trading due to a decrease in risk appetite. In addition, the greenback gained ground against the EUR as there is increasing concern over Europe’s debt crisis. It is important to mention that earlier this week; Moody's ratings agency cut Greece's credit rating by three notches to B1 from Ba1. The Stock Markets in the U.S. closed positive as the Dow Jones rose by 1.03% and the NASDAQ gained 0.73%. The drop in oil prices alleviated concern that rising energy costs will hurt the economic rebound, while Bank of America fueled optimism in the health of the home-loan industry. Crude Oil lost 0.25% today on speculation that OPEC will boost production. OPEC may schedule a meeting to discuss increasing production, moving below $105 a barrel. All eyes are looking to the Middle East as people are concerned about what's going to happen in Saudi Arabia on March 11, the "Day of Rage".  Gold (XAU) fell by 0.35% and closed at $1428 and it will remain bearish if rumors that Libyan leader Muammar Gaddafi might be looking to step aside will be verified. Today, US Treasury Secretary, Geithner is expected to make a speech.

Euro (EUR) – The euro fell against the dollar as concerns about Europe's sovereign-debt problems re-emerged - Moody's rating service cutting Greece's credit ratings by three notches on Monday .The trend is bearish. Holding below its strong resistance level of 1.3960 might push the pair back to 1.3850 zones. Overall, EUR/USD traded with a low of 1.3861 and with a high of 1.4035. Today, German Industrial Production is expected to improve from 1.80% vs -1.50% previously.

EUR/USD – Last:  1.3899

British Pound (GBP) – The pound fell against the greenback for the third day in a row. The Bank of England will leave its benchmark interest rate unchanged at a record low, as policymakers hold off tackling inflation as concerns mount about the strength of the recovery. The trend is bearish and the pair will test its support at 1.6100. Overall, GBP/USD traded with a low of 1.6125 and with a high of 1.6341. Today, the Trade Balance is expected to show improvement from -8.5B vs -9.2B.

GBP/USD - Last: 1.6155

Japanese Yen (JPY) – The Yen fell against the U.S Dollar as stocks market in the U.S closed positive and commodities dropped. The trend is bullish for the pair and it will probably test it resistance level at 83.10. Overall, USD/JPY traded with a low of 82.20 and with a high of 83.05. Tomorrow, in the early morning, the Final GDP is expected to show a decrease of -0.30%.

USD/JPY-Last: 82.87

Canadian dollar (CAD) – The Canadian dollar traded mostly unchanged against the US dollar remaining in a tight range of 42 pips with a hint that it might be strengthening. CAD fluctuated around the 0.97 zones and is attempting to determine a further trend. Holding above the support level of 0.9700 might rebound the pair back to parity. But, if the "Day of Rage" in Saudi Arabain will turn into something unexpected, Oil prices will keep going up and the pair will probably will break its strong support of 0.9700. Overall, USD/CAD traded with a low of 0.9700 and with a high of 0.9742. Today, NHPI is expected to grow by 0.20% vs 0.10% previously.

USD/CAD - Last: 0.9713