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Euro rallied to 1.2976 after the German IFO business climate index unexpectedly rose to 106.8 in November from 105.3 the previous month.
In addition, data contributed to the 0.6% Q/Q growth in Q3 German GDP reflected buoyant private consumption, exports and investment. These healthy economic factors supported ECB's hawkish stance towards the European interest rates and thus, more hike would be seen in next year. The euro's bullish sentiment was boosted further after IFO Institute economist Gernot Nerb commented that German exporters could live with the euro at current level of around 1.30 but would suffer if it climbed abv 1.35.
Cable rose briefly to an intra-day high of 1.9169 after the U.K business investment for 3rd quarter rose by 3.1% Q/Q which was much stronger than economists' forecast of 1.1%. However, option defensive selling for the protection of 1.9200 option barrier sparked mild profit-taking interests in afternoon European session.
The U.S. unit also came under pressure against the Swiss franc and fell to 1.2205 on the back of stronger-than expected Swiss payrolls in Q3 (3.70 million versus the forecast of 3.67 million). Despite Japanese market closed for holiday, speculation of potential narrowing of yield differentials between Japan and U.S. continued to invite long liquidation by European investors. Hence, the greenback slided further to 116.03 in late European trading.
Data to be released on Friday include New Zealand trade balance, Swiss retail sales, German CPI and HICP, as well as U.K. GDP for Q3. -------------------------------------------------------------
Updating time : 23/11/2006 13:42 GMT
Dollar remains under pressure on negative sentiment
Euro rallied to 1.2976 after the German IFO business climate index unexpectedly rose to 106.8 in November from 105.3 the previous month.
In addition, data contributed to the 0.6% Q/Q growth in Q3 German GDP reflected buoyant private consumption, exports and investment. These healthy economic factors supported ECB's hawkish stance towards the European interest rates and thus, more hike would be seen in next year. The euro's bullish sentiment was boosted further after IFO Institute economist Gernot Nerb commented that German exporters could live with the euro at current level of around 1.30 but would suffer if it climbed abv 1.35.
Cable rose briefly to an intra-day high of 1.9169 after the U.K business investment for 3rd quarter rose by 3.1% Q/Q which was much stronger than economists' forecast of 1.1%. However, option defensive selling for the protection of 1.9200 option barrier sparked mild profit-taking interests in afternoon European session.
The U.S. unit also came under pressure against the Swiss franc and fell to 1.2205 on the back of stronger-than expected Swiss payrolls in Q3 (3.70 million versus the forecast of 3.67 million). Despite Japanese market closed for holiday, speculation of potential narrowing of yield differentials between Japan and U.S. continued to invite long liquidation by European investors. Hence, the greenback slided further to 116.03 in late European trading.
Data to be released on Friday include New Zealand trade balance, Swiss retail sales, German CPI and HICP, as well as U.K. GDP for Q3. -------------------------------------------------------------
