RTTN:Dollar And Yen Halts Rally; Italian Bond Auction And U.S. Economic Data Eyed
(RTTNews) - The U.S. dollar and the Japanese yen halted their rally in Thursday's Asian session and most pairs are moving sideways as market players await the Italian bond auction and U.S. economic data due out later in the day to get clues for direction.
Italy will auction its long-term debt today which includes three-and ten-year notes. The Treasury is planning to sell EUR 8.5 billion of debt in the final sale of the year.
Worries about the Eurozone debt crisis grew yesterday following the news that the European Central Bank's balance sheet has jumped to a record high, prompting traders to sell risky currencies and bet on safe havens.
The euro was hit hard, touching a decade low against the yen and an 11-month low against the dollar after the ECB said its balance sheet surged up by 239 billion euros in the week ended December 23rd to an all-time high of 2.73 trillion euros.
The dollar and the yen extended their European session's rally in New York deals yesterday, but halted gains in early Asian trading around 7:15 pm ET. Since then, most pairs are moving sideways within small ranges.
At present, the yen is worth 100.48 against the euro, 120.16 against the pound and 82.49 against the franc, compared to Wednesday's European session closing values of 100.85, 120.62 and 82.66, respectively.
The dollar that closed yesterday's European session at 1.2932 against the euro is currently trading at 1.2920.
Meanwhile, against the pound and the franc, the dollar is now trading at 1.5460 and 0.9427, respectively.
The dollar-yen pair that fell to a 16-day low of 77.57 at 9 am ET Wednesday reversed its direction thereafter and closed the European session at a 2-day high of 78.05. However, the pair declined in the afternoon in New York and extended its slide in Asian deals today. As of now, the dollar is worth 77.75 yen. If the dollar weakens further, it will break 77.6 level and target 77.3.
