Majors are declining slightly against the US dollar on reason of an expected cut in interest rates followed by the FOMC decision which is due this week; however the Yen is gaining against the US dollar as the Unwinding of Carry Trades takes over. Today, the economical calendar is full of fundamentals where main focus is on the Existing home sales data coming from the US economy. Market shows; the Euro trading around 1.4220 levels, the Sterling trading around 2.0454 levels whereas the Yen reached to 114.36 levels.
The Euro began its morning session fluctuating within narrow ranges then further during the day it began to decline against the US dollar due to the everlasting Unwinding of carry Trades in which investors are buying back the Yen. The economical calendar shows a few fundamentals coming from the Euro Zone. Starting with, the Euro Zone is releasing the Current Account for the month of August where analysts expect a slightly higher reading of 2.0 billion from the prior reading of 1.7 billion. Also coming up is the PMI Manufacturing for the month of October which shows a slightly lower reading of 52.9 from the prior reading of 53.2. As for Euro Zone's PMI Services for the month of October, analysts expect a rise by 0.3 to 54.5 from the prior reading of 54.2. Finally, market awaits for Mr. Trichet speech on matters concerning the market. At the hour of this report, the Euro recorded a high of 1.4267 and a low of 1.4188
The Royal Pound is also dropping against the US dollar as the Unwinding of Carry Trades takes effect. Calendar shows lack of UK fundamental however with the US Existing Home Sales coming up later today, we expect a possible reaction from the Royal Currency. The Pound recorded a high of 2.0512 and a low of 2.0426.
Finally, the Yen is still benefiting from the Unwinding of Carry Trades as investors are buying back the Yen which seems to be a more tempting currency pushing the USD/JPY pair to the downside to record a high of 114.94 and a low of 114.20