Euro Drops to a Three-Week Low - 5.4.2012
US Dollar
The greenback climbed yesterday to the highest level since March 22, according to the currency’s index which touched 79.92 after the Federal Reserve damped expectations for further monetary stimulus for the US. In Asian trading hours today the dollar lost some ground against the aussie and the Japanese yen, sliding to 79.68. Today the data from the States may show fewer people submitted initial applications for jobless benefits last week.
Euro
The euro fell under pressure this week against the dollar, the pound and the Japanese yen. In the previous three days the greenback gained almost 2% versus the single currency as Spain sold fewer bonds than its maximum target at yesterday’s auction and the European Central Bank kept its main refinancing rate unchanged at 1%. The ECB president Mario Draghi said after the policy meeting that “the remaining tensions in euro-area sovereign-debt markets are expected to damp economic momentum.”
In Asian trading hours the euro traded in a narrow range of 1.3129-1.3164 before a report today that may show German industrial production declined. According to preliminary estimations, the measure dropped by 0.5% in February following a 1.6% gain in the prior month. Moreover France will offer investors today its bonds maturing in 2017, 2022, 2026 and 2041.
British Pound
The pound strengthened against the euro and pared some losses against the greenback after reports unexpectedly showed acceleration in the UK services sector. The PMI index increased in March from 53.8 to 55.3. The euro fell in the morning to the lowest level since January 17 against the pound – 0.8260, while the British currency rose above 1.5900 versus the dollar after touching yesterday 1.5832. Today the data may show industrial production in the UK increased in February by 0.4%, following a 0.4% drop in the prior month. Moreover the Bank of England will announce today its monetary policy decision, probably leaving the rate at 0.5%.
Canadian Dollar
The loonie depreciated against the US counterpart – pair USD/CAD rose yesterday from 0.9905 to 0.9972 before a report today that may show Canada’s job growth has slowed in the first quarter from a year earlier. According to preliminary estimations, companies hired about 10000 workers last month. If the actual figures meet with the expectations, that would mean the number of people employed increased by approximately 10000 in the first quarter of the year. In comparison the measure increased by 74600 in the first quarter of 2011, but dropped by 36500 payrolls in the last quarter of 2011.