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Record-breaking inflation support the Euro |
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Wednesday, 18 June 2008 |
Reported yesterday consecutive record inflation in the euro strengthen investor expectations for upcoming increases in the basic interest and support so increased movement of the Euro against the Dollar. This was raised and the end of three consecutive days of rise of the U.S. currency against the Euro.
Eurostat data from yesterday showed that inflation in the euro in May reached a record high value from 3,7% on an annual basis. The scenario for the rise in interest rates by the European Central Bank as early as next month becomes ever more likely, especially after yesterday's comments by members of the board of the bank, which confirmed as its first priority stabilize prices in the medium term. Increase in rates in the euro will make the single currency more attractive to investors at the expense of dollars. This is more depth during trading on Monday after the euro appreciated to levels of $ 1.5517, jumping one-month bottom of $ 1.5300 reached on Friday.
Additional pressure on the U.S. currency found and reported by Lehman Brothers Inc bad financial results. Investment bank announced a loss amounting to $ 2.8 billion for the quarter. Getting bad are results of Lehman Brothers were not surprised, but reminding investors that the credit crisis is still far from its end.
Bad news for the dollar came and reported an unexpected drop in production in the region of New York. Index 'New York Empire' for June is down to -8.68 to -3.2 from the previous month. The forecasts of analysts was for a value of -2.
EUR / USD Close 1.5475 High 1.5517 Low 1.5346
The euro continued to consolidate in the broad range after the key support level at 1.5300 to test again unsuccessful. Currently resistance movement appears to ascending 1.5520 rising level, as a breakthrough in the next targets are 1.5580 and 1.5640 levels. In downwards provide support level 1.5435 followed by 1.5350 and 1.5300 key. Bridging the last will open the potential for significant correction.
USD / JPY Close 108.20 High 108.56 Low 107.91
Growth of the Dollar against the Yen was suspended from key resistance at 108.50, which was tested failed and has great potential to cause strong corrective movement. Consolidation close to this level is very probable in the immediate term. Upon successful breakthrough following objectives are resistance at 110.00 and 111.20. In downwards provide support level 107.20, followed by 106.50 and 105.60.
GBP / USD Close 1.9632 High 1.9685 Low 1.9459
Trade keeps its neutral character without clear direction, Pound again was pushing up from the formed stable medium bottom around 1.9400. Currently at 1.9685 level of resistance has ascending movement, in the breakthrough following goals are the levels at 1.9725 and 1.9790. In downwards provide support level 1.9600 followed by 1.9505 and 1.9460. |
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