Forex Market Review – Euro rises above $1.32

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Euro climbed to a three-week high against the dollar during European trading hours to claw back losses made on Thursday when investors sold off the single currency over concerns of Chinese growth and Spanish debt. EURUSD opened the session at 1.3197 and rose to 1.3292  after breaking key technical resistance levels.

 

The broadly weaker greenback was reflected in the ICE dollar-index which tracks the dollar against a basket of major currencies. The index hit a two-week low of 79.214.

Sterling rallied against the weaker dollar early in the London trading session, recouping losses triggered by poor UK retail sales data the previous day. The pound was supported by comments today from Bank of England policy maker Martin Weal who said the UK economy was better than expected in the first quarter. GBPUSD began the session at 1.5813 and surged to 1.5907 before easing back down near the session open levels.

USDCHF sold to three-week in European trading to touch 0.9065 before bouncing.

EURCHF remains supported above 1.2050, near the exchange rate cap enforce by the Swiss National Bank.

USDJPY eased down to  82.34  after opening at  82.75. EURJPY briefly recovered to 109.81 before easing back down to 109.01.

The Canadian dollar touched a monthly low against its U.S. counterpart after data showed Canada’s annual inflation rate edged up in February to 2.6 percent from a rate of 2.5 percent in January.  The Bank of Canada targets 2 percent inflation within a control range of 1 percent to 3 percent.   USDCAD rose in reaction to the data, hitting a high of 1.0031.

Looking ahead, key US economic data on new homes sales are due later today. The forecast is for 325,000 new home sales versus a previous 321,000.