Daily Market Review – United States Session – Euro pares back from earlier session gains

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The Euro dropped against the USD throughout today’s US session, after having reached another 15 month high in mid European session at 1.4519. A lower than expected Industrial production figure of 0.4% helped put the brakes on the single currency which has been gaining steadily since mid March. The Euro was boosted earlier in the day by a hawkish signal with regards to further increasing the ECB’s interest rates in the upcoming months, as last week’s interest rate hike of 25 basis points was described as a non isolated decision. In spite of the expectations of further interest rate hikes, ECB president, Jean Claude Trichet, has gave no indication of another interest rate rise in the near future.

 

The Sterling traded around the 1.6270 level throughout today’s sessions, a level slightly above the day’s open of 1.6250, but failed to make any convincing movement in either direction. The GBPUSD traded with some volatility throughout the 2 latter sessions today, with peaks and troughs ranging by as much as 70 pips at times. Against the Euro, the Sterling fell to a 5 and a half month low, pushing the EURGBP pair to a high of 0.8922in mid European session.

 

The US session saw the Swiss Franc gain to within 7 pips of its all time low against the US Dollar today as the USDCHF pair dropped to a low of 0.8928 in midsession. The Swiss Franc has been gaining against the Dollar throughout this month and has shown no sign of stopping. The gains are believed to be as a result of market participants seeking a safe haven currency, something that has been prompted by recent troubles in Libya and the natural disasters that occurred and continue to occur in Japan.

 

The Canadian Dollar stayed firm today around the 0.9620 levels as a pause from yesterday’s drop in Oil prices saw a direct effect in the Canadian currency against the USD. The Canadian government bonds dropped a little ahead of the detailed economic projections from the BoC. The Canadian Dollar is now some 60 pips below the 2 and a half year high that was reached at the beginning of this week.

 

The US session see’s Gold depreciating some $7 per ounce and reaching a trough of $1451.1, but then recoup its loses and remain quite elevated from today’s open of $1452.7 as it currently trades around the $1456.7 levels. The precious metal experienced gains throughout most part of the day, following a depreciation of over $22 in yesterday’s sessions, as peace talks in Libya saw the commodity lose some of its appeal.

 

 

EURUSD USDJPY GBPUSD USDCHF USDCAD GOLD
OPEN

(12:00 GMT)

1.4506 84.04 1.6270 0.8976 0.9599 1458.0
DAY’S HIGH 1.4519 84.25 1.6308 0.8990 0.9654 1462.2
DAY’S LOW 1.4412 83.49 1.6236 0.8928 0.9584 1451.1
CLOSE

(21:00 GMT)

1.4442 83.77 1.6266 0.8962 0.9623 1455.3