UFXBank Forex News: Euro Drops as Risk Appetite Wanes | Learn Forex | GoLearnForex.com

UFXBank Forex News: Euro Drops as Risk Appetite Wanes

Written by article default Monday, 13 June 2011 07:25

USD Dollar (USD) – The dollar strengthened against most of the major currencies of forex trading due to a decline in risk appetite among investors. In addition, there is high speculation that Congress will help by reaching a debt-reduction deal, which will deadline risks sending the U.S. government into default. The Stock Markets closed the week negative as the Dow Jones fell by 1.41% and the NASDAQ lost 1.53%.  The Dow Jones Averaged its longest slump since 2002, as investor concern intensified regarding the global economy slowing down. Crude oil dropped for a second day, this time by 2.7%, and closed at $99.20 a barrel. The main reason for this is that upcoming reports may show slowing economic growth in the U.S. and China, curbing fuel demand in the world’s two largest crude consumers. Gold (XAU) fell by 0.7% and closed at $1,530 an ounce due to a strong US dollar. Today, no economic data is expected.

Euro (EUR) – The euro fell against the U.S Dollar as growing concern Europe’s debt crisis will worsen overshadowed prospects for interest-rate increases to tame inflation. European Central Bank President, Trichet may signal that the pace of interest-rate increases this year will slow. Trading below the resistance level of 1.4400 will keep the momentum negative for the pair but if the pair breaks above this resistance level, it might reach 1.4620 again. Overall, EUR/USD traded with a low of 1.4319 and with a high of 1.4694. Today, ECB President, Trichet is expected to speak.

EUR/USD – Last: 1.4340

British Pound (GBP) – The Pound fell for a second week in a row against the Greenback after the central bank kept its benchmark interest rate at a record low of 0.5%. The trend for the pair is bearish if the pair maintains its resistance level of 1.6280. Overall, GBP/USD traded with a low of 1.6212 and with a high of 1.6465. Today, no economic data is expected.

GBP/USD - Last: 1.6230

Japanese Yen (JPY) – The dollar strengthened against the yen due to expectations that the central bank is expected to keep the benchmark interest at zero to 0.1 percent tomorrow. In addition, Japan’s machinery orders fell by 3.30% for the first time in four months in April. If the pair will succeed in breaking its resistance of 80.80 it may bring the pair to 81.20 - the next resistance level. Today, no economic data is expected.

USD/JPY-Last: 80.50

Canadian dollar (CAD) – The Canadian Dollar fell against its U.S. counterpart due to the US Dollar strengthening and the decline in oil prices. This occurred despite a government report on Friday, which showed that Canada’s jobless rate unexpectedly fell to 7.40% from 7.60% in May to the lowest level since January 2009. After the release, the pair tried to break its support level of 0.9670 with no success. Today, no economic data is expected.

USD/CAD - Last: 0.9770