EU Morning Report- BoJ keeps rates on hold, eyes on the Fed

By @ibtimes on

 

The euro rebounded against the dollar yesterday following the eurozone finance ministers meeting. The second bailout package for Greece was signed off and it will be formally approved on Wednesday. The eurozone policymakers appeared pleased with Friday’s debt swap deal amd the Greek finance minister Venizelos said that implementation of the austerity program will continue in order for Greece to fulfill its fundamental obligations. But the single currency is still under pressure as investors fear that the eurozone debt crisis could worsen again. Against the greenback, the euro gained 0.9% climbing to 1.3191 from 1.3078.

The US dollar weakened against a basket of currencies yesterday as investors are expecting the Fed monetary policy decision. Against the Japanese yen, the dollar declined to 81.96 from 82.48 after the Bank of Japan monetary policy meeting. The central bank decided not to take any further easing steps in order to boost the Japanese economy. The yen strengthened after the decision as investors were nervous following the BoJ’s unexpected decision to loosen their monetary policy through asset purchases. The greenback also ticked lower against the Swiss franc, falling to 0.9140 from 0.9218. Focus now turns to the Fed Interest rate decision and the FOMC minutes expected later today. Investors are waiting to see whether the Fed will stay on hold or whether more easing is on the way. Recent economic data suggest that the US economy is recovering but with unemployment still at high levels makes today’s rate interest rate meeting a difficult decision for the Fed. US retail sales are also due today which may reflect consumer’s sentiment and economic growth.

The Australian dollar recovered its losses against the greenback today rising to 1.0560 from 1.0473. The Aussie has plummeted to its lowest level in almost seven weeks on poor Chinese trade figures. China is Australia’s largest trade partner and sign of economic slowdown in China weighs on the Aussie.

Oil prices climbed to 107.06 dollars a barrel today recovering from a fall to 105.37. Gold plummeted to 1692.45 dollars an ounce from 1712.97. Gold rose to 1308.41 euro an ounce from 1306.53. Silver fell to 33.33 dollars an ounce from 34.26.

 

Outlook

Pivot
Preference1
Sentiment2

EURUSD
1.3120
LONG @ 1.3120
44% of deals buy EUR

USDJPY
81.85
LONG @ 81.85
33% of deals buy USD

GBPUSD
1.5660
SHORT @ 1.5660
66% of deals buy GBP

AUDUSD
1.0510
LONG @ 1.0510
59% of deals buy AUD

GOLD
1696.00
LONG @ 1696.00
76% of deals buy GOLD

OIL
105.40
LONG @ 105.40
43% of deals buy OIL

1 data generated by Trading Central™, 2 data obtained from easy-forex Inside Viewer™

Calendar
Currency
Time (GMT)
Event
Forecast

GBP
09:30
Trade Balance
-7.88B

USD
10:00
Retail Sales
1%

USD
18:15
Fed Interest Rate Decision
0.25%

Equities
EUROPE

US

ASIA3

FTSE 100
0.09%

S&P 500
0.29%

NIKKEI
0.09%

DAX
0.31%

DJIA
0.22%

HIS
1.13%

CAC
0.07%

NASDAQ
-0.16%
?

CSI 300
0.97%

3 at the time of writing
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