Forex Daily Market Review – United States Session – Moody’s downgrade of Irish bonds makes waves in Forex market

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Today’s US session saw the Euro continue its day’s downtrend and drop a further 60 pips from the session open to reach a day’s low of 1.4390. The recent decline of the Euro comes about as Moody’s has cut Ireland’s rating by 2 notches to just above a ‘junk’ level and in effect resurfaced the recent Euro debt problems that have previously weighed heavily on the Euro. The Euro’s decline could have been even greater, had it not been for the fact that the US interest rates are expected to stay at their low level in the near future – a factor that has benefitted and has helped support the Euro. The current level of the EURUSD pair is at 1.4433, as it trades somewhat steadier as we approach the end of this week’s last session.

 

The Sterling continuously dropped against the Dollar in today’s US session, from an open of 1.6347 to a daily low, by mid-session, of 1.6292. The after affect of the weaker than expected UK economic activity data and the weak inflationary figures that came out on Tuesday, has appeared to weigh down on the Sterling, which in addition to the Dollar was also down against the majority of other crosses. Against the Euro the Sterling did strengthen however, as newly resurfaced worries with regards to the Euro zone debt ridden countries weighed heavily on the single currency.

 

The USDCHF pair had a rather volatile session and traded within the range of around 0.8920 to 0.8955 for most of the US session. The Swiss Franc remains relatively close to its most recent all time low of 0.8895 that was reached yesterday in the wake of the European session as it continues to benefit from uncertainty in the market, as well as the recent weakening of the USD in light of the fact that the interest rates are expected to remain constant in the near term.

 

The US session saw the Canadian Dollar recoup some of the loses experienced in the previous sessions as the USDCAD pair dropped by over 50 pips from an early US session high of 0.9648 to a session and 2 day low of 0.9591. The Looney had seen loses in previous session, indirectly due to the recent downgrade of Ireland’s bond rating by Moody’s, however US inflation data that showed rising food and gasoline prices in March helped spur the CAD against the USD.

 

Gold has done it again, reaching a new record high at $1487.9 in late US session, rising by over $10 from an open of $1477.1, following a steady Asian and European session. The precious metal’s gains are believed to be following the recent crude Oil rally and concern with regards to the downgrading of Ireland’s bonds. The current level of the safe haven commodity is around the $1486.3 levels, as it remains firmly close to the all time high.

 

 

EURUSD USDJPY GBPUSD USDCHF USDCAD GOLD
OPEN

(12:00 GMT)

1.4451 83.30 1.6347 0.8935 0.9635 1477.1
DAY’S HIGH 1.4502 83.77 1.6372 0.8958 0.9648 1487.9
DAY’S LOW 1.4390 82.95 1.6292 0.8914 0.9591 1471.4
CLOSE

(21:00 GMT)

1.4425 83.08 1.6294 0.8922 0.9598 1487.2