Forex News – Optimism Driven By Improved Earnings Reports |
Investors targeted higher yielding assets during the European session on Tuesday after some companies reported earnings that beat estimates. Those good earnings shifted the attention from Europe's and US's debt worries. Now markets will be eyeing the earnings from the big U.S. financial institutions.
The dollar weakened today against its major counterparts as the worries about the U.S. debt situation persist. Officials must come to an agreement about the debt ceiling till August 2, deadline. The European leaders will meet in a summit later this week to further discuss Greece's new rescue plan.
Pessimism will continue to dominate markets and caution may increase demand on safe heaven any moment as long as debt problems in the United States and Europe continue to weigh down on overall confidence. This keeps high demand on gold which today rose to a record high at $1609.97 level.
Today the German ZEW economic sentiment survey showed current conditions being better than expected. This managed to give an extra push to the euro against the dollar, which rose to the highest of 1.4217 and as of this writing is consolidating around the 1.4175 level.
Since the GBP lack the important economic data till later this week, the currency still moves in a euro centric mode. Today it rose to the highest of 1.6159 and now is consolidating around the 1.6115. The yen however continues to move in a tight range around the 79.00 level since questions about economic outlooks persist.
The AUD also managed to climb driven by gold and demand on higher yielding assets despite the dovish tone of the interest rate meeting minutes from the Reserve Bank of Australia, which signaled that interest rates will probably remain unchanged at 4.75% for several months.
The U.S. will begin today to publish the housing sector data with the building permits and housing starts reports which may show slight improvements in June. While Canada will present its rate decision which might be kept unchanged at 1.00%.
Originally posted here.
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