Euro has been steady against the dollar above $1.25, trading in a range since yesterday. This is mainly due to market participants being cautious and waiting on the sidelines amid a lot of uncertainty in the euro zone ahead of Greek elections and also due to rising Spanish and Italian bond yields. Late yesterday Moody’s cut Spain’s credit rating by three notches. However, EURUSD has remained supported despite market jitters, trading above 1.2541 during the Europe session and finding resistance at 1.2588.
Sterling gained back some losses made after a sharp drop yesterday against the dollar. The pound remains vulnerable amid increasing expectations for policy easing from the Bank of England. Some investors are expecting that BOE Governor Mervyn King will use his speech scheduled for later today to highlight his preference for a new round of monetary easing. GBPUSD bounced from a low of 1.5471 to 1.5546.
Yen has gained 0.2 percent against the dollar since poor US retail sales data from Wednesday and higher unemployment claims today weighed on the USD. Meanwhile the yen is also gaining ahead of the upcoming Bank of Japan policy meeting on Friday. USDJPY opened at 79.42 and fell to 79.14. EURJPY made small moves, edging lower from the open of 99.86 to 99.45.
EURCHF drifted lower to 1.2003 after a brief spike to 1.2019 following the announcement of the Swiss National Bank to maintain the exchange rate floor at 1.20 CHF.
The New Zealand dollar is the best performer today up 0.7 percent against the greenback. This comes after the RBNZ kept interest rates unchanged at 2.5 percent to let the economy grow further. The bank policy statement did not signal any further policy easing which helped lift the kiwi. NZDUSD rose to 0.7788 in European trading, up from yesterday’s low of 0.7720.