The euro dropped against its major counterparts yesterday as risk aversion dominated the currency markets. Fears about China’s economic slowdown intensified yesterday after data showed a surprisingly weak manufacturing activity at Chinese factories in March. The single currency dipped below the 1.32 level against the greenback to trade as low as 1.3178 from a two-week high 1.3284. The euro is further weighed by concerns about Spain’s slow progress in boosting its finances pushing up Italian and Spanish debt yields. Focus now turns to the eurozone Purchasing Manager Index figures expected later today.

The US dollar appeared strong yesterday supported by a heightened appetite for the safe haven currency and hopes for a firm US recovery. The Fed Chairman Ben Bernanke said during his speech yesterday that the US banking system remains exposed to Europe but the Fed’s stress tests showed US banks could handle a worsening eurozone debt crisis. Against the Japanese yen, the greenback jumped to 84.09 but later dipped to 83.13 after Japan revealed its first trade surplus in five months.

The Australian dollar tumbled against the greenback yesterday after China’s PMI figures showed that the Manufacturing sector shrank at the fastest pace in four months. China is Australia’s largest export market and signs of economic slowdown in the country add pressure on the Aussie. The pair slid to 1.0376 today from 1.0527, a decline of 1.4%.

Oil rose to 107.62 dollars a barrel from 106.03. Gold rose as high as 1661.74 dollars an ounce from 1646.65. Against the euro, gold rose to 1254.78 from 1248.27 an ounce. Silver ticked higher to 32.37 dollars an ounce from 31.89. Stay in tune throughout the day with !

 

OutlookPivotPreference1Sentiment2
EURUSD1.3250SHORT @ 1.324538% of deals buy EUR
USDJPY83.70SHORT @ 83.6544% of deals buy USD
GBPUSD1.5880SHORT @ 1.587529% of deals buy GBP
AUDUSD1.0475SHORT @ 1.047573% of deals buy AUD
GOLD1660.00SHORT @ 1660.0073% of deals buy GOLD
OIL107.65SHORT @ 107.6560% of deals buy OIL
1 data generated by Trading Central, 2 data obtained from easy-forex Inside Viewer
CalendarCurrencyTime (GMT)EventForecast
EUR09:30Retail Sales-0.4%
EUR10:00Industrial New Orders-2.1%
EUR12:30Initial Jobless Claims354K
EquitiesEUROPEUSASIA3
FTSE 1000.01%S&P 500-0.19%?NIKKEI0.40%
DAX0.23%DJIA-0.35%?HIS0.13%
CAC-0.10%?NASDAQ0.04%CSI 300-0.16%?
3 at the time of writing