Forex Market Review – Dollar down against yen after soft U.S. ISM data

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Euro fell against the dollar during U.S. session trading as the post-EU Summit euphoria has faded and market participants  are being cautious as they start to question EU summit deal. Risk appetite was also dampened after disappointing U.S. economic data. The ISM index which is a  gauge of U.S. manufacturing,  unexpectedly fell in June, indicating slowing economic expansion . This led to a flight to safety into less risky currencies like the greenback and the yen.

 

EURUSD fell to a North American session low of  1.2567, down 0.8 percent from the early Asian session high. The single currency began falling earlier today after Finland and the Netherlands opposed the use of the euro zone’s permanent ESM bailout fund to buy government bonds in the secondary markets.

 

GBPUSD remained stable above 1.5652 but capped at  1.5720. Sterling was buoyed by better than expected UK manufacturing PMI data.

 

Yen was the best performer today based on its safe haven status. USDJPY was down 0.36 percent after falling as low as 79.30 following weak U.S. data. EURJPY fell 1.4 percent on the day to 99.75 from 101.26.

 

The Australian dollar touched an almost two-month high against USD on bets the RBA will leave interest rates on hold tomorrow. AUDUSD remained close to the day high of 1.0276 during New York trading hours.