Rollercoaster is the best way to describe the financial markets yesterday, as the vice president of the People's Bank of China said the bank is thinking about diversifying their reserves, to drive the still weakening U.S Dollar to new low levels against majors. Yet today market participants will be waiting for both the BoE and the ECB, to release their decisions regarding their Benchmark interest rates, as markets expect Mr. Trichet to single out the ECB will Hike rates in the next meeting.
The Euro recorded a new life time high against the U.S Dollar yesterday at 1.4729 yet declined back opening today's Asian session below the $1.47 level, recording a high of 1.4659 and a low of 1.4624. The ECB is expected to keep rates unchanged at 4.0% today, while markets expect Mr. Trichet to hint for a rate hike in the Bank's next meeting.
The crown was given to the Pound yesterday, as it benefited the most from the ongoing weakness of the U.S Dollar, recording a new 26-year high at 2.1071 yesterday, yet the Pound declined with the start of today's Asian session to record a low of 2.0982 and gained afterwards to set a high of 2.1031.
As for the Japanese Yen it declined at the start of today's session yet came back to gain against the U.S Dollar, as the USD/JPY pair recorded a high of 113.03 and a low of 112.50.