Euro off 8-month high ahead of ECB rate decision, Italy political tensions weigh . . . . . . . Euro retreated from an 8-month high against the U.S. dollar Wednesday ahead of the European Central Bank’s monthly policy meeting later in the day. Investors will be closely watching ECB’s President Mario Draghi in a press conference following rate decision. The Governing Council meeting in Paris — one of two ECB’s meetings held outside Frankfurt — is widely expected to leave interest rates unchanged at a record low 0.5 percent, while keeping a wary eye on stumbling blocks to the Eurozone’s nascent recovery. Demand for the euro was also damped earlier in the session as Italian Prime Minister Enrico Letta is scheduled to address the Senate and face a confidence vote today followed by the Chamber of Deputies lower house. Letta’s government will be tested in a confidence vote today, after former premier Silvio Berlusconi’s decision last week to withdraw support. The EURUSD pair is currently trading at $1.35312, after starting the session at $1.35252, while recording a high of $1.35386 and a low of $1.35069. The trading range for today is among the key support at $1.3400 and key resistance at $1.3655. Dollar remained marginally low against major peers amid concerns over how long the partial U.S. government shutdown might last while lawmakers search for a compromise deal on the budget. The shutdown began after House and Senate lawmakers failed to agree on a spending plan for the new fiscal year that started yesterday. The USDIX index extended losses for the four consecutive session, trading around 80.18 from the session’s opening of 80.28 after hitting a high of 80.39 and a low of 80.15. Meanwhile, the Japanese yen gained against the dollar amid the U.S. government shutdown and investors weighed Prime Minister Shinzo Abe’s sales-tax increase and stimulus plan. Japanese Prime Minister Shinzo Abe raised Japan’s sales tax for the first time in 16 years, in line with adding 5 trillion yen ($51 billion) to stimulate the nation’s economy. The USDJPY pair traded sharply lower to recorded a low of ¥97.512 from a high of ¥98.077, after kick starting Wednesday’s session at ¥98.000. #egyptyard
Posted on: Wed, 02 Oct 2013 10:18:17 +0000
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