News Column

Euro Declines Against Majors

July 22, 2014



CANBERA (Alliance News) - The euro fell against the other major currencies in the Asian session on Wednesday, as traders await Eurozone's consumer sentiment index for July, due later in the day.

Economists expect the reading to remain in negative territory, with a score unchanged from May's 7.5.

The euro was also weighed by the possibility of further sanctions from the EU, after the leaders said they would impose sanctions on vast sectors of the Russian economy, unless it co-operate with the investigation of the MH17 airplane crash.

The EU foreign ministers meeting in Brussels on Tuesday called on the separatist groups in the Malaysian plane crash area to ensure full, immediate, safe and secure access to the site to proceed with victim identification as well as to recover remains of those deceased.

According to the statement, the EU foreign ministers said they agreed to accelerate the preparation of targeted measures agreed at the special meeting of the European Council on July 16. The council agreed to expand restrictive measures in order to target individuals supporting or benefitting from Russian policy makers, who are working to destabilise eastern Ukraine.

United Nations Secretary-General Ban Ki-moon on Tuesday urged both Israelis and Palestinians to stop the fighting that has been raging for the past two weeks in the Gaza Strip, and pleaded with the two sides to return to dialogue with the aim of addressing the underlying causes of the repeated cycles of violence.

At a joint news conference with Israeli Prime Minister Benjamin Netanyahu, the U.N. chief urged Israel to exercise "maximum restraint", adding that "military action will not increase Israeli security in the longer term".

The euro depreciated to 0.7885 against the pound, its lowest since August 2012. The next possible support for the euro lies around the 0.78 zone. At Tuesday's close, the pair was worth 0.7889.

The single currency dropped to 1.3457 against the US dollar for the first time since November 18. On the downside, 1.33 is seen as the next possible support level for the euro. The pair finished Tuesday's trading at 1.3464.

The euro weakened to 136.46 against the yen, a level untouched since February 3. This may be compared to yesterday's closing value of 136.57. If the euro-yen pair continues its slide, it may find support at the 135.00 zone.

The euro dropped to 1.2144 against the franc in the Asian session and stablised shortly thereafter. The pair finished yesterday's trading at 1.2149. The euro is likely to find support around the 1.21 area.

The 18-nation currency fell to near a 3-week low of 1.4442 against the loonie, 8-month low of 1.4259 against the aussie and a 1-week low of 1.5501 against the kiwi, reversing from early highs of 1.4467, 1.4356 and 1.5553, respectively. The euro is likely to target support around 1.42 against the aussie, 1.43 against the loonie and 1.54 against the kiwi.

Looking ahead, the minutes of the Bank of England's July monetary policy meeting and UK mortgage approvals for June are due to be released in the European session.

In the New York session, Canada retail sales for May and Eurozone consumer sentiment index for July are due to be released.

At 7:45 am ET, Bank of England Governer Mark Carney will participate in a debate on the Global Economy at the Glasgow University.



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Source: Alliance News


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