Moody's downgrades Spain's rating by two notches
- The euro rallied against the greenback during yesterday's US session after a report from the UK's Guardian newspaper said that Germany and France agreed on a 2 trillion dollar rescue deal to fight Europe's debt problems. But investors' risk appetite remains in check after rating agency Moody's cut Spain's rating by two notches to A1 from Aa2. It seems that investors' attention is focused on this week's EU summit which is expected to result to a plan to resolve Europe's sovereign debt crisis. Against the dollar, the euro initially fell to 1.3656 from 1.3787 but today the pair rallied to trade above the 1.38 level at 1.3839. Versus the Japanese yen, the single currency gained 1.4% jumping to 106.22 from 104.77.
- The US dollar edged lower against a basket of currencies on Tuesday as investors appear optimistic that the weekend's summit will provide a fundamental solution. Producer Price Index data showed a higher than expected gain of 0.8% in September while 0.2% was expected. Focus now turns to Consumer Price Index expected today.
- The British pound fell yesterday after higher than expected UK inflation data. The Consumer Price Index showed the annual inflation rose to 5.2% in September, which is the highest since September 2008. The figures weighed on the sterling as they raised concerns the UK may suffer from a slow growth and elevated inflation levels. Against the dollar, sterling dipped to 1.5631 from 1.5821 but today the pair trimmed some of its losses to trade at 1.5769. Eyes turn to the Bank of England policy meeting minutes at 08:30 GMT that may provide an insight on which policymakers voted in favor of extending the size of the bank's quantitative easing program.
- Oil prices gained 4.1% rising to 89.01 dollars a barrel from 85.53. Gold dropped to 1626.84 dollars an ounce from 1676.60 but later rebounded to 1665.06. Silver edged lower at 30.35 dollars an ounce from 31.99 and later recovered to trade as high as 32.29.
SHORT @ 1.3820
SHORT @ 76.95
SHORT @ 1.5780
LONG @ 1.0185
LONG @ 1643
LONG @ 87.35
1data generated by Trading CentralTM, 2data obtained from easy-forex Inside ViewerTM
Consumer Price Index in September
Housing Starts in September
3at the time of writing
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