The euro rose today as world equities turned positive ahead of the European Central Bank’s LTRO auction to inject money into the eurozone’s financial system. Risk sentiment in the market recovered as it is expected that about 500 billion euro of cheap loans will be offered to the European Banks easing fears about a eurozone debt contagion. This may help stabilize markets by easing concerns about a liquidity crunch in Europe. Further supporting demand for riskier assets was a successful Italian bond auction, which caused the 10-year debt yields to drop. News that Irish Prime Minister announced that there will be a referendum on the EU fiscal compact increased uncertainty but failed to weigh on the single currency. Versus the Japanese yen, the single currency rose to 108.72 today from 107.29. Eurozone inflation figures are also due today.
The US dollar weakened against a basket of currencies yesterday as risk appetite dominated the markets. Economic data from the US showed that the Consumer Confidence hit a one-year high in February but Durable Goods Orders were weaker than expected. Against the Japanese yen, the dollar rose to 80.78 from 80.01 but today slid to 80.25. Focus now turns to the US Gross Domestic Product expected later today.
The Australian dollar advanced against the greenback yesterday hitting a 3-week high after data showed retail sales rose in January easing fears about an interest rate cut by the Reserve Bank of Australia. Expectations for bank liquidity in Europe by the ECB also supported the Aussie as well as higher commodity prices. The pair rose to 1.0822 from 1.0729, a 0.9% rise.
Oil prices dipped to 105.89 dollars a barrel from 108.70. Gold edged higher to 1790.28 dollars an ounce today from 1765.38. Gold rose to 1331.49 euro an ounce from 1319.34. Silver ticked higher to 37.19 dollars an ounce from 35.27.
|EURUSD||1.3375||LONG @ 1.3385||26% of deals buy EUR|
|USDJPY||80.70||SHORT @ 80.65||45% of deals buy USD|
|GBPUSD||1.5870||LONG @ 1.5870||49% of deals buy GBP|
|AUDUSD||1.0750||LONG @ 1.0750||16% of deals buy AUD|
|GOLD||1775.00||LONG @ 1775.00||46% of deals buy GOLD|
|OIL||108.15||LONG @ 108.15||50% of deals buy OIL|
|EUR||10:00||Consumer Price Index||-0.8%|
|USD||13:30||Gross Domestic Product Annualized||2.8%|
|FTSE 100||0.21%||S&P 500||0.34%||NIKKEI||0.01%|