Forex-Metal Daily Analysis -04/02/2011

The pound reaches new weekly maximums.

Asian and European trading sessions:
Australian Dollar: Strong Australian economic docket supported the national currency on Thursday, and the Australian dollar hit its 1-month highs. Trade balance report showed higher surplus compared to the forecasts. Building approvals demonstrated considerable increase.
Euro: Market participants were waiting for the statement of Jean-Claude Trichet after the decision of the ECB regarding the principal rate. The released Euro-zone fundamentals were mixed. German and Euro-zone PMI services and composite indices were above expectations. But the Euro-zone Retail sales for December showed a decrease of 0.6%, when the forecasted growth was at 0.5%, which had a temporary pressure on the euro. And the EUR/USD pair dropped from the maximums of $1.3826 to $1.3750.
According to the expectations, the ECB left the principal rate unchanged at the previous level of 1.00%. But according to the released information, the head of the ECB, Jean-Claude Trichet, did not express concerns over the increased inflation level, and the euro started to drop.
US Dollar: Political instability in Egypt rendered support to the save-haven assets, and the US dollar started to strengthen. Expectations for the strong US fundamentals supported the greenback as well.
British Pound: Today the GBP/USD pair renewed its weekly maximums at the level of $1.6277, which was a result of the published UK PMI Services data, which turned out to be at the 54.5 against the expected 51.3.
Japanese Yen: The USD/JPY pair grew to the Y81.84 mark.

American trading session:
Euro: The EUR/USD closed the trading day at the $1.3600 mark.
US Dollar: Strong US fundamentals, which were released during the second part of the day, were even better than expected. Initial jobless claims dropped, ISM non-manufacturing composite index increased above forecasts and the Factory orders volume grew, when the forecast was negative.
British Pound: The pound also decreased following the negative dynamics of the euro and the GBP/USD pair dropped to $1.6150 at the end of the trading day.