Euro Advances On Greek Deal Hopes
May 28 2015 - 4:07AM
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The euro climbed against the other major currencies in early
European deals on Thursday, on optimism that Greece is getting
closer for a deal with its creditors, which would help Athens to
secure funding to keep its afloat.
Greek government and the Brussels group of its official
creditors had started procedures for drafting a staff-level
agreement, indicating a breakthrough in negotiations to unlock €7.2
billion bailout amount to Greece.
Greek Prime Minister Alexis Tsipras said his government was in
the final stretches of deal with its European and International
Monetary Fund lenders.
Meanwhile, German Finance Minister Wolfgang Schaeuble poured
cold water on hopes of a swift deal. European Commission Vice
President Valdis Dombrovskis also played down hopes of a resolution
soon.
Data from Destatis showed that Germany's import prices continued
to fall in April but at a slower than expected pace.
Import prices fell 0.6 percent year-on-year in April, slower
than the expected decrease of 0.7 percent and 1.4 percent decline
seen in March.
The currency was trading higher against its major rivals, except
the franc, in the Asian session.
The single currency hit a 2-day high of 1.0947 against the
greenback and a 6-day high of 0.7117 against the pound, compared to
Wednesday's closing values of 1.0902 and 0.7097, respectively. The
next possible resistance for the euro is seen around 1.12 against
the greenback and 0.725 against the pound.
The euro firmed to a 9-day high of 135.48 against the Japanese
yen and has been steady thereafter. The euro is seen finding
resistance around the 136.00 area. At yesterday's close, the pair
was valued at 134.77.
Data from the Ministry of Economy, Trade and Industry showed
that Japan's retail sales climbed 5.0 percent on year in April,
coming in at 11.562 trillion yen.
That was shy of forecasts for an increase of 5.5 percent
following the 9.7 percent contraction in March.
The euro spiked up to a 6-day high of 1.3625 against the loonie.
At yesterday's close, the euro was trading at 1.3573 against the
loonie. If the euro extends its uptrend, it is likely to find
resistance around the 1.38 area.
The 19-nation currency rallied to 1.4241 against the aussie, its
strongest since May 18. On the upside, 1.44 is possibly seen as the
next upside target level for the euro. The pair was trading at
1.4106 when it ended yesterday's trading.
Data from the Australian Bureau of Statistics showed that
Australia's private capital expenditure fell a seasonally adjusted
4.4 percent on quarter in the first quarter of 2015, coming in at
A$35.895 billion.
That missed expectations for a decline of 2.2 percent, which
would have been unchanged from the previous three months.
On the flip side, the euro pared its early gains against the
franc, trading at 1.0340. This may be compared to an early high of
1.0361. The pair was valued at 1.0351 at yesterday's close.
Looking ahead, the second estimate of first quarter U.K. GDP,
U.K. index of services for March and Eurozone business climate
index for May are set to be published shortly.
In the New York session, Canada industrial product and raw
material price indices for April, U.S. weekly jobless claims for
the week ended Mar 23 and U.S. pending home sales data for April
are slated for release.
At 7:00 am ET, ECB board member Yves Mersch is expected to speak
at the Bulgarian Authorities 2015 IMF/World Bank Constituency
Meetings in Sofia, Bulgaria.
At 2:45 pm ET, Federal Reserve Bank of Minneapolis President
Narayana Kocherlakota will deliver a speech on monetary policy
before a Community Leader Lunch hosted by the Helena Branch of the
Federal Reserve Bank of Minneapolis in Helena, Montana.
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