Euro rises on recovery signs

By @ibtimes on

The euro advanced to the highest level in more than two months against the Swiss franc, after hitting three-month high versus the dollar last week, as German exports rose for the second month, providing hopes the largest economy in the euro area will lead recovery in the region.

German exports increased 0.5% for the second month in December while imports slipped 2.3%. Also, the improvement in developing economies, especially in China, as well as the US isgiving optimism global recovery is gathering momentum, which gave uplift to higher-yielding asset.

Yet, the euro surrendered some of the gains on speculations the Bundesbank president Axel Weber will not succeed Trichet in ECB Presidency.

Concerning the euro-dollar pair, it inclined for the third day to reach a high of 1.3662 but it fell from there to1.3635, where it is currently trading, while the day's low was recorded at 1.3609.

The trading range for today is among the key support at 1.3500 and the key resistance at 1.3860.

On the flip side, the dollar index, which tracks the dollar movement versus a basket of major currencies, dropped to a low of 77.84 but it recovered some of the losses as it rebounded to 77.98, close to the day's opening, before the release of US jobless claims tomorrow.

Moving to the royal pair, it is little changed, traded close to the day's opening after reaching a high of 1.6099 and a low of 1.6042, where the pair was pulled down by resistance at 1.6100 yet it is finding solid support at 1.60 psychological level.

Today, the CBI lowered growth forecasts and raised inflation projections for the current and next year, to add to concerns, ahead of the BoE rate decision tomorrow which is expected to witness no change in monetary policy from the prior month.

The trading range for today is among the key support at 1.5965 and the key resistance at 1.6300.

With regard to the dollar-yen pair, it continued its rally for the sixth consecutive session to touch a high of 82.66 after dipping to a low of 82.23 to settle at 82.55.

The trading range for today is among the key support at 81.05 and the key resistance at 83.70.

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