Forex Market Review – Euro rallies above $1.27

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Euro rallied above $1.27 during the U.S. session, making up for recent losses as risk appetite picked up following news from Greece and U.S. housing data.  There is talk that the EU will ease the terms of the Greek bailout.   Meanwhile, focus shifts to the U.S. Federal Reserve policy meeting which  concludes on Wednesday. There is optimism that the FOMC could  unveil more easing measures in order to stimulate growth in the U.S. economy. Such a move would be positive for risk correlated currencies like the euro.

 

EURUSD gained over 1 percent during the North American trading session to surge to a high of 1.2729.

Against the yen, euro jumped 1 percent  to  100.48 yen, erasing Monday’s losses.

 

Sterling tracked the euro and rose against the dollar, with GBPUSD hitting  1.5756, the highest since May 23. Gains will be capped as focus will turn to the BOE minutes that will be released tomorrow on the last policy meeting.

 

Dollar fell against the Swiss franc, pushing USDCHF to a low of 0.9431, down over 1 percent on the day.

 

The Canadian dollar jumped 0.3 percent against the greenback after U.S. data showed an increase in building permits. USDCAD fell to a low of 1.0165, down from a NA session high of 1.0229. The loonie was supported by higher crude oil prices which were up compared to yesterday. Oil is a major Canadian export.

 

The Australian dollar jumped to a six-week high of $1.0199 due to the improved risk sentiment and weaker U.S. dollar as a result of lower safe haven demand.