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FOREX: Dollar and Yen Rise, Euro Falls Amid Renewed Greece Debt Fears

Overnight Headlines

  • Dollar, Yen Outperform as Greece Debt Fears Stoke Risk Aversion
  • NZ Trade Surplus Widens to Record as Exports Rise Most in 5 Months

Critical Levels

CCY

SUPPORT

RESISTANCE

EURUSD

1.4206

1.4346

GBPUSD

1.6419

1.6526

The Euro and the British Pound declined in overnight trade, down as much as 0.4 and 0.3 percent respectively against the US Dollar as the greenback capitalized on safety demand in a risk-averse start to the trading week (see below). We continue to look for EURUSD selling opportunities.

Asia Session: What Happened

GMT

CCY

EVENT

ACT

EXP

PREV

22:45

NZD

Trade Balance (NZ$) (APR)

1113M

600M

578M (R+)

22:45

NZD

Exports (NZ$) (APR)

4651M

4300M

4613M (R+)

22:45

NZD

Imports (NZ$) (APR)

3538M

3700M

4035M (R-)

22:45

NZD

Balance - 12mo YTD (NZ$) (APR)

1187M

571M

734M (R+)

23:01

GBP

Hometrack Housing Survey (MoM) (MAY)

-0.1%

-

0.0%

23:01

GBP

Hometrack Housing Survey (YoY) (MAY)

-3.7%

-

-3.3%

1:00

AUD

HIA New Home Sales (MoM) (APR)

0.2%

-

4.3%

1:30

AUD

Company Operating Profit (QoQ) (1Q)

-2.0%

2.0%

-1.7% (R+)

1:30

AUD

Inventories (1Q)

0.4%

0.1%

0.8% (R+)

5:05

JPY

Small Business Confidence (MAY)

37.8

-

36.1

The US Dollar and Japanese Yen outperformed in overnight trade, rising as much as 0.3 and 0.2 percent respectively against their top counterparts, with currency markets taking on a risk-averse tone. The reemergence of Euro Zone debt fears seems to have been the catalyst behind traders’ dour mood after a story in Der Spiegel published over the weekend said Greece may have missed all of the fiscal goals set forth as conditions for receiving an EU/IMF bailout package. Tellingly, the Euro led the majors lower while the Greek CDS rate – a measure of the priced-in likelihood of default in the beleaguered country – rose 14bps to the highest in a week.

Related: NZ Trade Surplus Widens to Record, Improves Outlook on Productivity and Exports

Euro Session: What to Expect

GMT

CCY

EVENT

EXP

PREV

IMPACT



No Data




With no economic data on the calendar while UK and US markets closed for holidays, a quiet session seems likely ahead. However, traders would be wise to be wary of knee-jerk price action – particularly given the troubling Euro Zone news over the weekend the subsequent risk-averse mood in Asia – as thin liquidity conditions threaten to amplify volatility. Indeed, stock index futures tracking key European exchanges are moving aggressively lower ahead of the opening bell, pointing to continued gains for the anti-risk US Dollar and Japanese Yen.

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