The euro dropped to a one month low versus the US dollar. While the eurozone still struggles to escape the debt crisis, optimism over the US economy starts to grow. The eurogroup has formally approved Greece’s second bailout and said this would help the Greek economy grow again. Versus the Japanese yen, the single currency rose to 109.63 yesterday from 108.38.

The US dollar continued to strengthen yesterday against a basket of currencies supported by growing optimism about the US economic recovery. Expectations for a third round of quantitative easing by the Fed started to fade following upbeat US economic data and a less dovish FOMC statement by the Fed. A rise in the US bond yields have also been a driver of the dollar’s strength. Against the Japanese yen, the dollar broke above the 84 level as the yen is weighed by expectations for further monetary easing by the Bank of Japan. The pair advanced to 84.17 from 82.95, a 1.5% gain. Focus now turns to the US Manufacturing Index and Producer Price Index.

The Australian dollar dipped against the greenback yesterday weighed by worries about growth in China as well as declining commodities. The pair slid as low as 1.0422 from 1.0549 yesterday. The Swiss franc also fell as investors are expecting the Interest Rate Decision by the Swiss National Bank later today. The euro jumped against the Swiss franc, climbing to 1.2147 from 1.2072 on speculation the SNB may lift the floor of EUR/CHF from 1.20 Swiss francs.

Oil prices dipped to 105.11 dollars a barrel from 107.00. Gold plummeted to 1634.10 dollars an ounce from 1682.05, a 2.9% decline. Gold rose to 1286.75 euro an ounce from 1279.36. Silver ticked lower to 31.62 dollars an ounce from 33.41.

 

OutlookPivotPreference1Sentiment2
EURUSD1.3090SHORT  @ 1.309060% of deals buy EUR
USDJPY83.30LONG @ 83.3027% of deals buy USD
GBPUSD1.5680SHORT  @ 1.568054% of deals buy GBP
AUDUSD1.0480SHORT  @ 1.048063% of deals buy AUD
GOLD1662.00SHORT @ 1662.0076% of deals buy GOLD
OIL106.80SHORT @ 106.8055% of deals buy OIL
1 data generated by Trading Central, 2 data obtained from easy-forex Inside Viewer
CalendarCurrencyTime (GMT)EventForecast
USD12:30Initial Jobless Claims356K
USD12:30Manufacturing Index17.50
USD12:30Producer Price Index0.5%
EquitiesEUROPEUSASIA3
FTSE 100-0.18%?S&P 500-0.12%?NIKKEI0.72%
DAX1.19%DJIA0.12%HIS-0.31%?
CAC0.40%NASDAQ0.03%CSI 300-0.57%?
3 at the time of writing