Euro retreats after recording the best first quarter  

By @ibtimes on

The 17-nation currency slipped against majors today, after posting the best kick off of a year till March on the improvement in Germany and increasing possibilities the ECB would raise interest rate, on worries regarding the region's debt-ridden economies.

The euro closed March and last week on gains as the progress seen in the latest data from the biggest economy in the region revived hopes that Germany will lead recovery this year.

Also, since the announcement of Trichet last month that the ECB may raise interest rate in April on the back of the rise in inflation to 2.6% in March, according to the CPI flash estimate, the euro gained further strength.

Today, euro zone PPI for the month of February printed 6.6% on the annual basis compared with revised 5.9%.

Yet, on the other hand, there are some worries that raising interest rate by the ECB may harm debt-strapped nations that still repay debt and with speculations that Portugal will accept a bailout from the EU, concerns are aggravated more which pushed the pair to the downside today.

On the other hand, the dollar index, which tracks the dollar movements versus a basket of major currencies, inched up to trade at 75.90 compared with the day's opening level of 75.85.

Concerning the euro-dollar pair, it slipped from a high of 1.4268 to trade around 1.4208, while the day's low was recorded at 1.4190.

The trading range for this week is among the key support at 1.4000 and the key resistance at 1.4500.

Moving to the British pound versus the dollar, it advanced for the second day after data showing that UK PMI construction beat estimates of 54.8 to record 56.4 in March, where the main highlight of the week will be on Thursday's BoE rate decision.

So far, the pair is trading at 1.6140 after recording a high of 1.6175 and a low of 1.6099, where the trading range for this week is among the key support at 1.5870 and the key resistance at 1.6500.

With regard to the dollar-yen pair, it is showing slight decline to halt the latest rally that was boosted by the G7 intervention in FOREX market through selling the yen as the pair did a slight downside correction where it is currently trading in an overbought area, according to the Stochastic Oscillator momentum indicator.

The pair is trading at 84.00 meanwhile after reaching a high of 84.37 and a low of 83.93, while the trading range for this week is among the key support at 82.35 and the key resistance at 86.30.

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