Market News

The common currency rebounded close to a 2-month peak against the U.S. Dollar in Asian trading following news that Eurozone inflation levels surged, with speculation that the European Central Bank might move to raise interest rates sooner than later.

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High risk currencies fell broadly in Asian trading today on investors concern that growing unrest in Tunisia and Egypt could trigger further violence in the Middle East.

In Asian trading, the Japanese Yen managed to recoup some of its earlier losses against the U.S. Dollar following the credit rating downgrade of Japanese sovereign debt by Standard & Poor’s. As reported at 12:54 p.m. (JST) in Japan, the U.S. Dollar traded lower against the Yen at 82.70 Yen, down from 82.90 Yen during late New York trading yesterday, well off the 83.22 Yen immediately after the announcement.

The U.S. Dollar remains close to a 2 month low against the common currency Euro following the conclusion of yesterday’s U.S. Federal Open Market Committee meeting.

The U.S. Dollar Index held close to a 10-week trough in Asian trading today, as market players await confirmation that economic growth will remain the focus for the U.S. Federal Reserve.

In Asian trading today, the Australian Dollar tumbled against major rivals following the release of consumer inflation data which came in below economists’ expectations, and which sent a signal to investors that the Reserve Bank of Australia is unlikely to raise interest rates any time soon.

The common currency back off of a 9-week peak against the U.S. Dollar in Asian trading today, as profit takers sold off their short term holdings in the currency.

The Euro moved closer to the recently struck 2-month peak versus the U.S. Dollar in Asian trading today, and market players expect to see further gains as sentiment for the common currency turned favorable.

In early afternoon trading in Tokyo, the common currency Euro slipped against the U.S. Dollar and the Japanese Yen, but is expected by some dealers to rebound later when data from China confirms a strongly growing economy.

The dollar fell to an eight-week low against the euro on speculation a sluggish recovery in U.S. housing and labor markets will deter the Federal Reserve from raising interest rates.

Investors had hoped that this week’s meeting of finance ministers from the Eurozone would result in a strengthening of the rescue fund, yet no definitive outcome came from yesterday’s meeting, and investors get the sense that the market is placing more significance of the fund then are the finance ministers.

The common currency Euro held close to a 1-month peak against the U.S. Dollar in Asian trading today, as market players speculate that the current gains are likely limited, and can be attributed to last week’s short covering. In the long term, investors insist that the European policymakers must come up with some clear-cut answer to providing a safety net for the highly indebted Eurozone nations that are seeking assistance.

Sales by Japanese exporters and institutional investors helped to drive down the Euro against the Japanese Yen in Asian trading today. Market players foresee, however, that the Euro might rebound during the European session and even into next week, following this week’s successful bond sales by several of the Eurozone’s highly indebted nations.

In Asian trading today, the Euro retreated from the 1-week high struck following the successful bond auction conducted by the Portuguese government yesterday, even as investors await today’s auctions of Spanish and Italian debt.