The euro has further reversed recent gains versus the dollar and sterling, while also falling back against the yen and Swiss franc as eurozone sovereign debt issues once again undermine sentiment. Markets reacted negatively to the overnight announcement from Moody’s that it was placing Spain’s AA2 sovereign rating on review for a possible downgrade on the back of increased vulnerability of its government finances and the risk of a sustained rise in funding costs. A lacklustre Italian bond auction yesterday is also weighing on the euro.
The single currency’s downside, …

The euro has fallen back versus the dollar and other majors, giving up some of its recent gains, as euro zone sovereign associated risks have come to the fore once again. Weighing on euro sentiment were contrasting statements by euro zone leaders, highlighting that last week’s deal to rescue Greece has far from solved all the problems. The Greek Prime Minister referred to the country’s new deal as “in essence tantamount to introducing a European bond”, which could well cause concern amongst critics of euro zone bailouts in Germany and …

Building on gains seen going into the weekend, the euro pushed to three week highs versus the dollar in early morning trade. As well as positive reaction to last week’s EU deal, the single currency is also benefiting from a round of general dollar selling on the back of the impasse in the US debt talks. Taking out a number of key resistance levels along the way to highs of $1.4510, the euro is expected to continue to find support near term.
Concerns about the US debt problem are also weighing …

While risk aversion remains very much to the fore, forex markets are somewhat steadier. Indeed, the euro, is off its weekend record low against the Swiss franc which, along with the yen, is the safe haven currency of choice. The euro also gained slightly against the dollar in yesterday’s trade. Even so, the single currency continues to struggle for support, with markets remaining very jittery about the eurozone debt situation as they await Thursday’s eurozone leaders’ summit. These concerns were reflected yesterday in a sharp rise in Italian and Spanish …

The dollar weakened sharply yesterday after Fed Chairman, Ben Bernanke, in his testimony before the House Financial Services Committee said the Fed is ready to ease monetary policy further if the economy weakens and inflation moves lower. The currency then dropped further after Moody’s put US debt under review for possible downgrade, warning that the US could loose its AAA rating if the authorities fail to raise the country’s debt ceiling and the government misses debt payments. The dollar selling, however, has run out of steam and the currency …

Majors traded in relatively narrow ranges overnight as markets await today’s key US non-farm payrolls report. Yesterday saw better than expected ADP private sector employment numbers and many in the market are now expecting that total payrolls will have increased in June by more than the recent consensus forecast of 90,000.
Yesterday was a day of two halves for the euro. The decision by the ECB to hike rates by 0.25% to 1.5% had been factored in and the single currency slipped further ahead of the post meeting press conference. There …

The euro fell yesterday following news that Moody’s had downgraded Portuguese debt to junk status, warning that the country may need a second round of rescue funds. There had already been a somewhat weaker tone to the euro. Factors such as weak PMI and retail sales data for the region and speculation that China may raise rates at the weekend, which was dampening risk sentiment, were weighing on the single currency. The sell-off following the news of the Portuguese downgrade, however, proved short lived and the euro regained much of …