Previous session overview
The euro fell slightly against the dollar and yen in Asia Tuesday as weaker regional share markets and apparently dovish statements from the Australian central bank prompted players to cut exposure to riskier, higher-yielding assets such as the euro.
As most major Asian bourses slumped, with Japan's benchmark Nikkei 225 Stock Average down 0.5% in early afternoon trade, players sold the risk-sensitive European currency.
Minutes from the Reserve Bank of Australia's Nov. 3 meeting released during the Tokyo morning session also weighed on higher-yielding currencies such as the Australian dollar and euro, dealers said. The bank said it will likely continue raising interest rates, though called the pace of such hikes "an open question," cooling expectations for further tightening in December.
Against the yen, the common currency traded hands at JPY133.32 compared with JPY133.34.
The greenback stood at JPY89.08 at 0450 GMT, unchanged from its level late Monday in New York. The Dollar Index, which measures the currency's value against six major units including the euro, was at 74.922 compared to 74.890.
Yesterday the Euro had a wild trading day gaining heavily with stocks and oils but was pummeled lower on Bernanke's pro USD comments before reversing these losses to make fresh highs above USD1.5000. October EU CPI was at 0.3% as forecast. EURJPY struggled to track the improved risk appetite as USDJPY dived to month lows.
Yesterday the Pound was very solid rallying up to fresh month highs above USD1.6800 on continued cross recovery and generally strong risk appetite. EURGBP broke below stg0.8900 support and GBPJPY continued to test the JPY150 level.
The Australian dollar was broadly flat late in Asia Tuesday having receded from fresh highs after dealers put a dovish gloss on minutes from the central bank's November meeting, taking the heat out of rate hike bets and supporting bonds in the process.
Market expectation
The dollar is slightly higher against major rivals, such as the euro and pound, but analysts doubt the U.S. currency's recovery can last long.
Investors saw Monday's rally in U.S. stocks and oil as an opportunity to keep pressing risk-seeking ideas and trades for the near term.
The euro could drop to JPY132.70 and USD1.4900 later in the global day, said some traders.
For EURUSD stronger offers said to remain in place between USD1.5015/20 ahead of USD1.5050/65. Support USD1.4935/30, USD1.4915/10 ahead of USD1.4880 (seen pivotal intraday).
EURGBP bids placed toward stg0.8870, a break exposes stg0.8845/40. Resistance seen placed at stg0.8905/10, stg0.8940/45. Cable offers USD1.6860, USD1.6880, and USD1.6900. Bids USD1.6830/20, USD1.6800, stops USd1.6795/90.
USDJPY resting heavy into the European session, testing the overnight lows at JPY88.92, with a break set to expose bids placed around Monday's five-week base at JPY88.75, with stops said to be lurking below. Little then eyed ahead of the October base at JPY88.01.
Most important events of the day
| 17-Nov | Count. | Event | For | Unit | Imp. | Act. | Cons. | Prev. |
| 0:00 | NO | Norges Bank Governor Gjedrem gives speech to The Norwegian United Federation of Trade Unions-Fellesfortbundet | Low | |||||
| 0:30 | AU | RBA release minutes of prior (3rd Nov) board meeting | Low | |||||
| 7:45 | EU | ECB Governing Council member Nowotny to attend conference on the Economic Integration of Austria with Europe | Low | |||||
| 8:15 | CH | Retail Sales | Sep | % y/y | Med | -1 | ||
| 8:15 | CH | Retail Sales wda | Sep | % y/y | Low | -1 | ||
| 9:30 | GB | CPI | Oct | % m/m | High | 0.1 | ||
| 9:30 | GB | CPI | Oct | % y/y | High | 1.4 | 1.1 | |
| 10:00 | EU | Trade balance (sa) | Sep | EUR bn | High | 1 | ||
| 10:00 | EU | Trade balance (nsa) | Sep | EUR bn | High | -4 | ||
| 10:30 | US | San Francisco Fed President Yellen gives speech "Moving Beyond the Banking Crisis"at Institute of Regulation and Risk North Asia event | Low | |||||
| 13:30 | US | PPI | Oct | % m/m | Med | 0.5 | -0.6 | |
| 13:30 | US | PPI ex food and energy | Oct | % m/m | Med | 0.1 | -0.1 | |
| 14:00 | US | Treasury International Capital System (TICS) | Sep | USDbn | High | 30 | 28.6 | |
| 14:15 | US | Capacity utilisation | Oct | % | Low | 70.8 | 70.5 | |
| 14:15 | US | Industrial production | Oct | % m/m | Low | 0.4 | 0.7 | |
| 14:30 | EU | ECB Executive Board member Stark gives speech at Euro Finance Week | Low | |||||
| 15:15 | US | Richmond Fed President Lacker to speak on "The Economic Outlook" | Low | |||||
| 16:00 | EU | ECB Executive Board member Tumpel-Gugerell takes part in "Ten years of Euro" panel discussion | Low | |||||
| 17:55 | US | Cleveland Fed President Pianalto gives speech before the 11th Annual Ohio Housing conference | Low | |||||
| 18:00 | US | NAHB Builders survey | Nov | index | Low | 19 | 18 | |
| 22:05 | AU | RBA Assistant Governor Debelle to speak at the Australian Securitization Conference | Low | |||||
| 23:30 | AU | Westpac-MI Leading Index | Sep | % m/m | Low | 1.1 |
