Traders Cautious on the Euro

The euro extended declines and bonds rose as European political risk ensured an ongoing demand for havens. The dollar edged higher before the release of Fed minutes.

Europe’s currency dropped a fourth day, briefly passing 1.05 per dollar for the first time in more than six weeks as sovereign bonds across the region advanced. Germany’s DAX Index of stocks, already at an almost two-year high, crossed the 12,000 level before paring gains. Oil fell from the highest price in more than a week amid speculation about the effectiveness of OPEC’s supply curbs and forecasts for another expansion in U.S. crude stockpiles.

Investors in Europe seem increasingly divided, with French presidential elections and the U.K.’s Brexit plans driving demand for the safest debt and optimism for global economic growth and improved corporate earnings supporting stocks. Traders will next turn their focus to minutes from the U.S. Federal Reserve’s latest meeting, which may offer more clues on the path of interest rates in the world’s biggest economy.

Bloomberg

USD/JPY – Yen Improves to 113, Fed Minutes Next

Ifo Points to Pick Up in German Growth

MS

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Craig Erlam

Craig Erlam

Senior Currency Analyst at OANDA
Based in London, England, Craig Erlam joined OANDA in 2015 as a Market Analyst. With more than five years' experience as a financial market analyst and trader, he focuses on both fundamental and technical analysis while conducting macroeconomic commentary. He has been published by The Financial Times, Reuters, the Wall Street Journal and The Telegraph, and he also appears regularly as a guest commentator on networks including Sky News, Bloomberg, CNBC and BBC. Craig holds a full membership to the Society of Technical Analysts and he is recognized as a Certified Financial Technician by the International Federation of Technical Analysts.