Forex Trading News – GBP slips against the EUR – Risks of downside for the single currency

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EUR bounced today after last week’s selloff, although blown up long positions and euro zone debt worries pointed to downside risks. Technical indicators also suggested the euro could ease, although a rebound in some commodities after their rout last week helped risk appetite and ensured the single currency stayed well above a 3 week low hit versus the USD last week. However, with data showing bullish bets on the euro rose to their highest since July 2007 and concerns over Greek debt returning to the fore, the currency’s outlook remained uncertain.

EUR/USD opened the session at $1.4382 and moved as high as $1.4440 but during the end of the session in fell to a low of $1.4313. The single currency fell late on Friday following a German news report, which was later denied, that suggested Greece had raised the possibility of leaving the euro zone.

GBP slipped versus the EUR, after the single currency recovered from a steep fall the previous session, with the sterling seen staying under pressure ahead of the Bank of England’s inflation report later this week. Recent softer than expected UK data have added to expectations that the BoE is unlikely to raise rates soon, and suggest the BoE may give a more downbeat assessment on growth when it issues its latest forecasts on Wednesday. Data out today further supported the view of an unreliable economic recovery, as the Confederation of British Industry cut its UK growth forecasts slightly and Halifax said UK house prices fell 1.4% in April, confounding forecasts for a rise of 0.1%. EUR/GBP opened the session at 0.8770 and moved as high as 0.8816.

CHF edged higher versus the EUR after a German news report, later denied, suggested Greece has raised the possibility of leaving the euro zone. The franc was slightly higher against the euro compared to the New York close, trading 1.2594 per euro. Later in the session EUR/CHF fell as low as 1.2561.

Gold climbed above $1500 an ounce on Monday and silver rallied more than 6% as a retreating USD and a rebound in oil prices helped precious metals recover some ground after last week’s hefty losses. Gold rose as high as $1510.38 and silver rallied more than 6% to a high of $37.96. A near 1% retreat in the USD, which makes dollar-priced assets cheaper for other currency holders, is helping silver to recover.

	EURUSD	EURGBP	GBPUSD	USDCHF	EURCHF
OPEN (07:00 GMT)	1.4382	0.8770	1.6397	0.8757	1.2594
DAY’S HIGH	1.4440	0.8816	1.6406	0.8770	1.2627
DAY’S LOW	1.4313	0.8770	1.6314	0.8731	1.2561
CLOSE (16:00 GMT)	1.4325	0.8773	1.6325	0.8773	1.2570

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