UFXBank Forex News: Euro Gains as Leaders Aim to Solve Debt Crisis | Learn Forex | GoLearnForex.com

UFXBank Forex News: Euro Gains as Leaders Aim to Solve Debt Crisis

Written by article default Tuesday, 17 May 2011 07:32

USD Dollar (USD) – The dollar fell versus most of the major currencies due to a high concern over the debt limit, which increases the possibility of a “double-dip” recession and an increase in unemployment. In addition, the Empire State Manufacturing Index showed that manufacturing growth in the New York region cooled after weakening to 11.9 vs. 20.7 that was forecast. Global demand for U.S. long-term financial assets such as government bonds also slowed in March as investors shifted into shorter-term securities with China also trimming its portfolio of treasuries. The Stock Markets extending a two- week slump as the Dow Jones fell by 0.38% and the NASDAQ lost 1.63%. Crude Oil fell by 2.00%, closed at $96.90 a barrel after the opening of spillways reduced concern that the Mississippi River will flood refineries. Gold (XAU) lost 0.10% and closed at $1,490 an ounce. Today, Building Permits are expected to show 0.59M as they did previously. Housing Starts are expected to rise to 0.58M vs. 0.55M previously, and Industrial Production m/m is expected to rise by 0.5% vs. 0.8% previously.

Euro (EUR) – The euro strengthened in forex trading against the U.S Dollar as European finance ministers tackled the region’s sovereign-debt crisis. In addition, the euro gained from an inflation report in the 17-nation currency bloc, which accelerated to the fastest pace since 2008, boosting pressure on the European Central Bank to raise interest rates. The pair may test it support at 1.4000 again. Trading below this support level will change the momentum to negative for the pair, but if the pair doesn’t break below this support level, it might strengthen to 1.4250. Overall, EUR/USD traded with a low of 1.4047 and with a high of 1.4338. Today, German ZEW Economic Sentiment is expected to show 4.8 vs. 7.6 previously.

EUR/USD – Last: 1.4150

British Pound (GBP) – The Pound strengthened a bit against the Greenback, erasing part of Friday's losses. The trend for the pair is still bearish if the pair maintains it resistance level of 1.6250. Overall, GBP/USD traded with a low of 1.6146 and with a high of 1.6516. Today, the CPI y/y is expected to rise by 4.2% vs. 4.0% previously and BOE Inflation Letter is expected to be released.

GBP/USD - Last: 1.6185

Japanese Yen (JPY) – The dollar strengthened against the yen after the pair succeeded to break its strong resistance of 81.00. The US Dollar showed strength against the yen, despite speech by the Governor of the Bank of Japan, Shirakawa, who was signaling that his greatest worry is inflation. The trend for the pair will be bullish if the pair maintains it support of 81.00 and it may even bring the pair to 82.50. Today, no economic data is expected.

USD/JPY-Last: 81.15

Canadian dollar (CAD) – The Canadian Dollar declined against its U.S. counterpart as commodities fluctuated. Canada’s dollar reached the lowest level since March versus the U.S. dollar as crude oil, the nation’s largest export, fell as much as 2 percent. The trend for the pair is still bullish. Today, Foreign Securities Purchases are expected to rise to 4.93B vs. 2.5B previously.

USD/CAD - Last: 0.9750