Forex-Metal Daily Analysis – 07/10/2011

Market participants were expecting the results of the press-conference with the ECB President.

Asian and European trading sessions:
Euro: The EUR/USD pair traded today in the narrow range of $1.332 – $1.335 due to the expectations for the decision of the European Central Bank on the interest rate. Before the start of the European session, in anticipation of a press conference with the ECB President Trichet, the Euro fell against major currencies and the EUR/USD couple recorded its today’s low at $1.3242 level. The ECB, as expected, left interest rates unchanged at 1.50% and the EUR /USD pair strengthened to its daily highs at $1.3433 zone.
US Dollar: Against the background of the speculations’ increase about whether European leaders reached an agreement that will halt the further spreading of the debt crisis in the region, the US Dollar rate decreased against the most major currencies.
British Pound: The British Pound also traded with a decrease. The reason for that was the investors’ expectations that the Bank of England could announce its decision regarding some changes in the quantitative easing program. The Bank decision, about leaving interest rates unchanged at 0.50%, did not stress much the GBP/USD trading direction, while the increasing in volume of asset purchase program by 75 billion pounds to 275 billion pounds dropped the couple by more than 16 points to $1.5271 mark.
Japanese Yen: The USD/JPY couple traded in the range of Y76.55 to Y76.82 during the both sessions.
Australian Dollar: The Australian Dollar rose today affected by speculations on possibility of exact steps the IMF would made for resolving the EU debt crisis.

American trading session:
Oil: Oil futures increased on the NYMEX to $ 82.82 per barrel
Gold: The demand for the precious metals increased today on fears that Europe’s sovereign debt crisis will drag on the global economy, therefore, the Gold price strengthened and established it’s today high at $1655 area.
The Euro became stronger against the U.S. Dollar and Yen on assumptions, that the launch of the credit program by the ECB will stop the spread of debt crisis in the region.

The Swiss Franc fell against the Euro on speculations that the Central Bank will take further steps to ensure its strength after establishing its ceiling in last month at 1.20 mark to Euro.