Euro Steady Against Majors

uro Steady Against Majors


The European currency held steady against its major rivals Tuesday morning after a successful Spanish auction. However, the gains were capped by a report showed that German economic sentiment deteriorated more than expected in June.
Spain auctioned 12-month and 18-month T-bills and succeeded in raising debt slightly above the targeted amount. Though demand was better than at a May auction, borrowing costs were higher.
The Spanish treasury raised EUR 3.04 billion from the sale of its 12- and 18-month bills, slightly higher than the EUR 3 billion maximum target set for the sale, reports said. The agency sold EUR 2.4 billion of the 12-month paper with the yield shooting up to 5.074 percent from 2.985 percent in the previous sale on May 14.
The treasury also placed EUR 639 million of 18-month debt at yield 5.107 percent, up from 3.302 percent in the May sale. The bid-to-cover ratio rose to around 4.40 percent from 3.23 in the previous tap.
In an attempt to upgrade the war chest and help protect countries from the fallout of the euro zone debt crisis, China has reportedly agreed to contribute as much as $43 billion to boost the IMF's crisis- fighting reserves, while India and Russia agreed to provide $10 billion each to the IMF.
In economic news, German economic expectations declined more than expected in June, survey results published by the Center For European Economic Research showed. The ZEW Indicator of Economic Sentiment for Germany decreased by 27.7 points to a level of minus 16.9 points in June. This is the indicator's strongest decline since October 1998. Economists had forecast a decline to 2.3.
Construction output in the euro area decreased in April, after returning to growth in the previous month, data released by statistical office Eurostat showed today. Construction output decreased a seasonally adjusted 2.7 percent on a monthly basis in April, reversing the previous month's 11.4 percent increase, which came after thee successive contractions.
The common currency re-tested its Asian session peak against the yen in early deals Tuesday, rising as high as 99.69 but the pair failed to reach anywhere near the 100-mark. The euro-yen pair is presently hovering around the 99.50 level.
The Japanese leading index declined less than initially estimated in April, final data from the Cabinet Office showed today.
The leading index that signals the direction of the economy in the months ahead fell to 95.6 in April, the lowest reading since January, from 96.6 in March. But the reading was higher than the preliminary estimate of 95.1.
Likewise, the coincident index dropped to 96.9 from 97.3 points a month ago. The indicator measures the current economic activity. The April reading was revised up from 96.5.
The euro that climbed to 1.2630 against its US counterpart by 6:20 am ET leveled off shortly thereafter. The euro-buck pair is presently worth 1.2615 with 1.2670 seen as the next likely resistance level.
The single currency also advanced to 0.8063 against the pound by 5:00 am ET and the pair held steady thereafter. If the euro-pound pair strengthens further, likely target level is seen at 0.8080.
U.K. annual inflation slowed unexpectedly to 2.8 percent in May, its lowest since November 2009, the Office for National Office said. Economists were expecting the rate to remain unchanged at 3 percent in May.
The euro-franc pair has been trading in its recent ranges, roughly moved 2-pips to both direction. The pair has been swinging between 1.2011/13 since the beginning of Asian trading.
Looking ahead, the U.S. housing starts and building permits data for May is slated for release in the upcoming session.


More FOREX-news on pages InstaForex.Com



TELETRADE: Forex Managed Accounts Project