Nothing new from the Eurogroup meeting as we await German vote on the ESM
City Index July 10, 2012 1:00 PM
<p> EUR/USD Range: 1.2280-1.2320 Support: 1.2150 Resistance: 1.2450 A very quite start to the week for the single currency after last week’s 3% decline against […]</p>
A very quite start to the week for the single currency after last week’s 3% decline against the USD, there was very little fresh news from the EU Finance ministers meeting yesterday with the usual cry that struggling members should stick to austerity measures. The Euro fails to rally as Spain’s 10-year yield climbed back to the 7.00 boundary yesterday which have risen 11 basis-points to 7.06 percent. Today I’ll be watching for comments from the German constitutional vote on the ESM with anything other than a resounding yes being a total disaster for the Euro.
Range: 1.5498 – 1.5533
Very little to add as we await second tier data releases today with industrial production expected to have declined 0.2% whilst manufacturing production has a consensus improvement of 0.2%, the UK’s trade balance for May is also released at 9.30 with a consensus reading of -£9 billion expected. Cable holds the initial support of 1.5480 as EUR/GBP fails to close above the 0.7950 with investors now targeting a break of the 0.7900 support.
A slightly weaker reading on Chinese import and export data has weighed on equities and commodity currencies with the region now focusing on Friday’s Chinese GDP data. The Shanghai composite index is now approaching its 2012 lows at 2132. A significant decline to Friday’s number could reverse some of the gains the AUD has made against the Euro, pushing AUD/USD back towards parity.
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