Forex: EUR/GBP falls on ECB Draghi's speech

The euro is being pressured by ECB's Draghi words as he speaks before the European Parliament. He said the central bank's stance is accomodative and that the exchange rate, while not a policy target, it is important for growth and price stability. Eurozone weakness is expected to continue throughout 2013.

The EUR/GBP has fallen on the speech, just like the EUR/USD, easing from 0.8635 down to 0.8615, for now. Still, the cross trades higher on the day, slightly above the opening price of 0.8610.

Mataf.net analysts point to resistance at 0.8650, 0.8685 and 0.8725. On the downside, supports might be found at 0.8620, 0.8575 and 0.8545.

Feb 18, 2013

Forex: EUR/USD falls as Draghi speaks

The euro weakened and retraced its intraday advance versus the greenback after Draghi said in a conference exchange rate is not a policy target and that the ECB stance will remain accommodative.

Forex Flash: An improvement in Chinese economy may look to contain prices – NAB

China’s monetary aggregates were also released for January, showing a sharp up-tick in credit for the month. While this is a positive sign for credit demand in the economy, it could also partly represent a bringing forward of demand ahead of LNY. Similarly, reports of a clamp down on credit issuance late last year (as some banks approached their credit limits) may have resulted in some pent-up demand as well. According to the NAB Analyst Team, “While the magnitude of these effects is difficult to gauge, they could suggest that the strength in January may not be sustained over coming months.”