The euro recorded losses against most of its major counterparts, as market participants wait for the Eurogroup meeting on Friday. Eurozone Finance Ministers are expected to decide upon the way and the size by which the economic union’s rescue funds will be boosted. Market consensus is the lending capacity of both the European Financial Stability Facility (EFSF) and the European Stability Mechanism (ESM) to be raised to EUR 940 billion. Italian Prime Minister Monti shared his belief that the crisis is “almost over” during a speech in Tokyo. European Central Bank (ECB) President Draghi warned governments to continue taking decisive measures. He added that even though Long Term Refinancing Operations (LTROs) have calmed down the markets, this should not induce complacency. Against the US dollar, the single currency dropped to 1.3328 from 1.3357. The euro was boosted against the Swiss franc following Switzerland's Economy Minister comments that the floor should be raised to 1.35-1.40. However, this did not last long as investors realised that exchange rate policy is handled by the Swiss National Bank (SNB), not the Ministry of Economics.
The US dollar produced gains versus a basket of currencies recovering Monday’s losses caused by Fed Chairman Bernanke speech hinting to additional quantitative easing. The nation’s central bank head looks poised to downplay any positive economic data release, stating “it’s far too early to declare victory”. Versus the Swiss franc, the US dollar dropped to 0.9045 from 0.9031.
The Australian dollar plunged to 1.0441 from 1.0526 against the US dollar. Reserve Bank of Australia (RBA) Lowe advised industries harmed by the strengthening currency to adjust to the new environment, suggesting no intentions – at least for now – for an intervention.
Oil prices fell to 106.53 from 106.71 dollars a barrel. Gold dropped to 1680.90 from 1689.28 US dollars an ounce. Against the euro, gold retraced to 1262.11 from 1265.11 an ounce. Silver fell to 32.5959 from 32.7529 dollars an ounce.
|EURUSD||1.3355||LONG @ 1.3345||34% of deals buy EUR|
|USDJPY||82.75||LONG @ 82.80||46% of deals buy USD|
|GBPUSD||1.5935||LONG @ 1.5945||24% of deals buy GBP|
|AUDUSD||1.0470||LONG @ 1.0465||64% of deals buy AUD|
|GOLD||1687||LONG @ 1687||72% of deals buy GOLD|
|OIL||107.00||LONG @ 107.75||46% of deals buy OIL|
|GBP||08:30||4th quarter GDP||-0.2%|
|USD||11:00||Durable Goods Orders for February||3.0%|
|FTSE 100||-0.56%||S&P 500||-0.28%||NIKKEI||-0.72%|