Forex Asia Review – Asian markets consolidate

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Euro declined for the eighth consecutive day as a result of euro zone troubles, particularly political uncertainty in Greece. Greek leaders are struggling to form a government but parties fail to reach an agreement on implementing austerity measures. EURUSD closed Wednesday at below the critical $1.30 level for the first time in four months. The pair opened in Asia at 1.2928 and traded above that level  up to1.2955. The fact that the euro zone rescue fund, the EFSF, has agreed to pay out its next 5.2 billion euro bailout tranche to Greece today should  help buoy the euro  in the short term.

 

GBPUSD consolidated between 1.6122  and 1.6149 as investors await the Bank of England policy meeting later  today. The probability is low that a boost to the asset purchase program will be announced. Meanwhile against  the euro, sterling soared, which led the EURGBP to a new  3-1/2 year low of 0.8002.

 

USDJPY consolidated near  Wednesday’s 2-1/2 month low of 79.42. A further drop may be a struggle as there are concerns that the Bank of Japan will make a move to intervene in the currency markets to curb yen strength.

 

The Australian dollar got a brief boost after data showed Australia’s unemployment rate fell more than expected to 4.9 percent in April from 5.2 percent a month earlier. AUDUSD rose to  1.0118 from 1.0033 but pared gains after China reported slower growth in exports and imports. China is Australia’s major trading partner.