RTTN: Euro Falls To Multi-day Lows Against Most Majors
(RTTNews) - In early European session on Wednesday, the euro drifted lower against other major currencies even though the regional stocks advanced. The euro thus plunged to a 6-day low against the dollar and a 5-day low against the franc and the pound.
Taking cues from Asia, whee most stocks advanced, the European stocks too opened the day in a positive territory.
At 5:56 am ET, U.K's benchmark FTSE 100 index was up by 78.28 points or 1.5%, Germany's DAX gained 81.85 points or 1.4%. While, France's CAC 40 index rose 60.94 points or1.8%.
At 5:45 am ET, euro fell to a 6-day low of 1.2820 against the dollar and a 5-day low of 1.3489 against the Swiss franc, compared to yesterday's closing quotes of 1.2886 and 1.3565, respectively.
On the downside, the euro may target 1.253 against the dollar and 1.338 against the franc.
The Swiss National Bank said it has increased its foreign currency investments by some CHF 132 billion in the first half of 2010, with the bulk placed in euro-denominated investments. It noted that the income from foreign currency and Swiss franc positions and the steep rise in the price of gold limited the extent of loss to an estimated CHF 4 billion.
In a separate report, Swiss National Bank showed that the M3 money supply increased 7.7% year-on-year in June, faster than a 7.5% rise in the previous month.
Against the pound, the euro is trading now at a 5-day low of 0.8393 with 0.834 seen as the next downside target level. At yesterday's close, the euro was worth 0.8440 against the pound.
Bank of England's policy makers retained the key interest rate in July by a split vote, the minutes of the meeting showed today. Policy makers unanimously decided to maintain the stock of asset purchases financed by the issuance of central bank reserves at GBP 200 billion.
Seven members of the Monetary Policy Committee including Governor Mervyn King voted to hold the interest rate at a historic low of 0.5%. Andrew Sentance sought a 25 basis points hike to 0.75%. He had voted for a rate hike in June meeting also
The euro has depreciated 0.90% against the yen over yesterday's close and is now worth 111.73. The euro may target around the 110.80 level, if it falls further.
The Japanese government said today that the economy is picking up steadily, although it faces a difficult situation such as high unemployment rate.
In its monthly economic report, the Cabinet Office said despite the severe labor market situation, the economy is expected to be headed for a self-sustaining recovery as corporate profits continue to improve.
