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UFXBank Forex News: GBP Rises on Good Report from Fitch

Written by article default Tuesday, 15 March 2011 08:03

USD Dollar (USD) – The Dollar weakened against the other major currencies of Forex trading, amid fears over the impact on the global economic recovery from Friday’s devastating earthquake and tsunami in Japan. The NASDAQ and Dow Jones decreased by 0.54% and 0.43% respectively, Crude oil remained almost unchanged and rose by 3 only cents to 101.19$ a barrel, Gold (XAU) strengthened by 0.2%, and closed at $1424.90 an ounce. Today, the interest rate decision is expected to remain at 0.25%, the Federal Funds Rate will be released, and the TIC Long-Term Purchases are expected to decline from 65.9B to 59.3B.

Euro (EUR) – The Euro rose for a second day against the Dollar after European leaders agreed to widen the scope of a rescue fund set up to help deal with the region’s sovereign debt crisis. The EUR/USD’s momentum is bullish as long as the rate is above 1.3900 and above the 20 moving average on the daily chart. Overall, EUR/USD traded with a low of 1.3904 and with a high of 1.4003. Today, German ZEW Economic Sentiment is expected to rise from 15.7 to 16.2.

EUR/USD – Last: 1.3931

British Pound (GBP) – The Pound rose versus the Dollar after Fitch Ratings said the U.K. should keep its top credit, citing the government’s efforts to reduce the budget deficit. The next resistance level of the GBP/USD on the one hour chart is located at 1.6200, and if the pair breaks above this level, the pound will continue to be bullish. Overall, GBP/USD traded with a low of 1.6027 and with a high of 1.6199. No economic data is expected today.

GBP/USD - Last: 1.6128

Japanese Yen (JPY) – The Yen rose against most major currencies on speculation that there will be a repatriation of Yen currency back into the Japanese economy throughout the rebuilding process. Amid the chaos in Japan, the interest rate was released yesterday with no change at 0.1%. For now, the Yen’s trend is uncertain. If there will be an escalation of the crisis, such as a meltdown in one of the nuclear plants, Japan's economy could be severely damaged, which could cause the Yen to weaken. For now it is hard to predict a direction for the Japanese currency.

USD/JPY-Last: 81.47

Canadian dollar (CAD) – The Canadian dollar weakened against most other currencies as oil fluctuated on concern that factories in Japan will shut down following the country’s strongest earthquake. The pair is struggling at the 0.9700 rate, and if the pair breaks below this rate, the Canadian will be more attractive than the Dollar. Overall, USD/CAD traded with a low of 0.9710 and with a high of 0.9764. Today, Labor Productivity is expected to rise from 0.1% to 0.3%.

USD/CAD - Last: 0.9811