Daily Forex Overview

Previous session overview

The dollar moved lower against major counterparts in Asian trading, pressured by rising gold futures on expectations that U.S. interest rates will remain low.

The euro rose against the dollar and yen in Asia Thursday as stronger-than-expected Australian jobs data for October encouraged investors to buy riskier currencies such as the European unit.

Many currency investors were on the sidelines ahead of President Barack Obama's first state visit to Asia, for which he departs Thursday.

Obama's eight-day trip will take him to Tokyo, Beijing, Shanghai and Seoul as well as to the Asia-Pacific Economic Cooperation (APEC) summit in Singapore, where he is slated to meet with 18 fellow world leaders.

In early Tokyo trading Thursday, the euro rose to an intraday high of JPY135.02 compared with JPY134.54 in New York late Wednesday. The currency later trimmed some of its gains due to profit-taking, trading at JPY134.62.

The euro tumbled after its aggressive test of USD1.50, but the currency made significant headway versus the ultra-weak British pound and New Zealand dollar. Though there was no notable European data on hand, the divergence in EURGBP has more to do with indications that the Bank of England would continue to utilize its quantitative easing program while the European Central Bank is considering exit strategies.

The U.K. pound slumped Wednesday after Bank of England Governor Mervyn King said that recent sterling weakness would be supportive for an export-led recovery. Indeed, BOE Governor Mervyn King said that he will be keeping an "open mind" on additional asset purchases following the release of the bank's Quarterly Inflation Report, which continued to reflect forecasts for UK GDP to stage a lofty recovery through 2010, but subsequently lag through 2011 and 2012 as there will likely be "sustained weakness of demand."

The Australian dollar climbed to a fresh 15-month high on Thursday on news of unexpected growth in employment in October, and a subsequent rise in expectations that interest rates will be raised again in December.

Market expectation

The euro will likely see fundamentally-driven moves on Friday, though, upon the release of Euro-zone GDP. The quarterly rate is projected to rise for the first time since Q1 2008 by 0.5 percent, while the annual rate is anticipated to edge up to -3.9 percent from -4.8 percent.

EURUSD east European selling seen in recent trade though traders say that supply so far not having much immediate effect. Rate trades around USD1.4991. Bids confirmed at USD1.4950, with stops now reported below USD1.4930. Traders highlight the fact that the USD1.5000 level holds the strike of a decent sized option for today's 1500GMT cut.

USDJPY- picking up reports of offers at JPY90.00 with stops through JPY90.10, more on a break of JPY90.20/30.

The European single currency may extend its gains if U.S. weekly jobless claims data, scheduled for release at 1330 GMT, show fewer people claiming benefit, thereby helping push up share markets by further boosting players' risk appetite, dealers said.

Market participants are next awaiting U.S. economic reports including weekly jobless claims to gauge the health of that country's economy. Better-than-expected figures may lift stock markets worldwide, which could push the euro higher to JPY135.30 and USD1.5040, traders said.

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