Forex Asia Review – Euro consolidates at 2-yr low ahead of Eurogroup meeting

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Euro fell to a new two-year low against the dollar in early Asian trading as risk aversion continued following Friday’s disappointing non-farm payrolls numbers. Meanwhile, investors are being cautious ahead of the Eurogroup meeting later today.

 

EURUSD opened in Asia with a small gap down at 1.2261 versus Friday’s close of 1.2286. This marked the lowest level since June 27. Negative news over the weekend threw doubts on the timing and completion of the EU Summit rescue deal. European unity issues still exits and may perhaps delay implementation of the measures agreed on at the EU summit.

 

 

GBPUSD opened lower at 1.5474 and gradually drifted higher to 1.5495 before steadying. EURGBP fell early to a low of 0.7917 before edging back up to 0.7935.

 

 

USDJPY traded to and fro between 79.42 and 79.71 during the Asian session but remained lower compared to Friday. Sentiment was risk off and as Asian bourses declined, this boosted demand for safe haven assets like the Japanese yen. Meanwhile dollar was under pressure on rising expectations of QE3 by the U.S. Fed after a weak jobs report on Friday.

 

 

Aussie was kept in a sideways action, with AUDUSD supported above 1.0177 and trapped below 1.0211. A further move higher was capped after China CPI reported was softer than expectations. China is Australia’s major trading partner.