Thursday, 19 May 2011

USDJPY>>The Japanese Yen traded in range for much of Thursday with traders eyeing growth and GDP data. Commenting on the current situation, the Japanese Ministry was cautious on the long term growth prospects and outlook. Citing the earthquake and tsunami disasters, Japanese officials were confident that the economy could rebound. GDP figures painted an uncertain picture and fell below initial estimates. This could further erode confidence in the region. The USDJPY traded at 81.65 late in the day.

AUDUSD>>After a weak start to the session, the Aussie Dollar stabilised, closing near the 1.066 level. The currency received a boost early with commodity prices rising slightly. The recent selloff has led to a shift in currency allocation, with the AUD feeling the effects of renewed greenback sentiment. Economists are still predicting the direction the RBA will take from an monetary policy point of view. Traders continue to be concerned about the softening housing market.

EURUSD>>The Euro rallied against the greenback on Thursday with comments from ECB chairman Trichet sparking a rise in demand. Highlighting that the ECB would not be comfortable holding Greek debt, the ECB was adamant that a bailout would be extended to the embattled country based on EU agreed terms. The market was confident that this would lead to a level of segregation between the debt riddled and growth markets in the Eurozone. The EURUSD traded at 1.43060.

USDCHF>>Lacklustre session for the USDCHF with the currency undecided in its movements. Reacting early in the session to the ECB’s comments, traders soon looked towards other safe haven alternatives. This lead to shift in bond prices and a late rebound in the gold price. The equity market also dragged the greenback higher, with the Dow finishing 45 points higher. Economists have noted that a sustained strong Swiss Franc could have an impact on the local market.

GBPUSD>>The Pound broke out of its mid day trend to record a strong updside movement. Traders eyed the shift back into the European based currencies, with debt contagion fears having little impact on movements. Continued speculation over whether or not the Bank of England will raise rates, has been prominent. UK Inflation data released yesterday and the BOE’s comments have led to a heightened degree of volatility in the pair. The GBPUSD traded at 1.6227.

USDCAD>>Strength in numbers was the catch phrase for the Canadian dollar on Thursday, with the currency rising against the greenback. Trading at 0.9673, the pair moved in tandem with the Gold and Oil price. Initially weakening, buying pressure late in the session pushed the CAD higher.