Japan intervenes again to weaken a soaring yen
- The euro dropped today against the dollar as the initial euphoria following the EU summit starts to fade. The pair broke below the 1.40 level falling as low as 1.3974 from 1.4170, a decline of 1.4%. Italian Prime Minister commented on the eurozone and said that the euro as a common currency hasn't convinced anyone and added that austerity measures will only work with growth. Versus the Japanese yen, the euro gained 4.2% rising to 111.60 from 107.06 after Japan stepped in the currency markets to tame the soaring yen. Attention shifts to the eurozone Consumer Price Index expected later today.
- The US dollar edged higher against a basket of currencies today. The dollar gained 5.2% against the Japanese yen after the Bank of Japan intervened in the currency markets for the third time in 2011. Japanese Finance Minister explained the move saying that a strong yen poses a high risk for the country's exports and threatens its economic recovery. He also said that the central bank remains ready to step in to take measures against speculative moves and when the fundamentals of the Japanese economy are not reflected in the market. The intervention pushed the pair as high as 79.51 after a fall to a record low at 75.56.
- The Australian dollar plummeted today on speculation the Reserve Bank of Australia may cut interest rates at the monetary policy meeting tomorrow. Data showed that inflation slowed in the third quarter after Consumer Price Index gained 0.6% down from a previous 0.9%. Falling commodity prices also weigh on the Aussie and against the dollar it slid to 1.0506 from 1.0731 traded on Friday.
- Oil prices edged lower falling to 92.24 dollars a barrel from 93.53. Gold dropped to 1704.33 dollars an ounce today from 1744.79. Silver dropped to 34.11 dollars an ounce from 35.44.
SHORT @ 1.4110
LONG @ 77.90
SHORT @ 1.6035
SHORT @ 1.0656
SHORT @ 1728
LONG @ 92.00
1data generated by Trading CentralTM, 2data obtained from easy-forex Inside ViewerTM
Unemployment Rate in September
Consumer Price Index in October
Gross Domestic Product in August
3at the time of writing
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