The first two hours of currency trade this week have been quite volatile with this weekend’s events helping create some significant gaps from Friday’s close. Former Italian Prime Minister Silvio Berlusconi is determined not to serve any time in prison and is prepared to bring down the current coalition and force new elections in his negotiations. The Euro slipped down 30 pips on the open this morning trading at 1.3495 USD moments ago. The US dollar has lost ground against the Yen slipping half a cent over the weekend with the US political statement on funding still weighing on the minds of traders. The US dollar is buying 97.84 Yen and traded as much as 20 pips lower than this mark in the first few minutes of trade.
The Australian dollar has continued on from Friday’s falls versus the Greenback to drop below 93 US cents this morning almost 2.5 cents lower than last week traded high. The focus will remain on the Aussie with HSBC Final Manufacturing PMI to be released at lunchtime and tomorrow’s interest rates decision and statement on traders’ minds. The Pound has jumped of the gates this morning, up 20 pips from Friday to 1.6162 USD as the likelihood of further QE being ruled out to debase the currency.
New Zealand ANZ Business confidence due for release this morning will see the Kiwi dollar in focus, with the Australian dollar buying 1.1254 NZD after struggling in early trade. In the next hour we have Manufacturing PMI and Retail Sales from Japan, with solid number expected. At the time of writing the Australian dollar is buying 90.99 Yen, down over 40 pips since Friday.
Joel Murphy
www.pepperstone.com Joel Murphy is a currency analyst and market commentator for Forex Broker Pepperstone and he regularly features on Sky Business News Australia. He has worked in both retail and institutional Forex for last 8 years and completed a Bachelor of Commerce and a Bachelor of Arts from Monash University
