EUR USD
For the 24 hours to 23:00 GMT, EUR declined 1.04% against the USD and closed at 1.2677, amid growing concerns over the issues of Greece & Spain’s debt problems.
Euro came under pressure, after former Greek Prime Minister, Lucas Papademos, stated Greece could not rule out leaving the Euro-zone and preparations were being considered for nation’s exit.
Concerns over Spain’s troubled banking sector increased after the Institute of International Finance stated that Spanish banks could need another €76 billion to cover loan losses. Meanwhile in a bond auction, Spain raised €2.53 billion worth of 3- and 6- month maturing bills raising over its targeted goal of €2.5 billion, at a significantly higher yields than it paid for the same maturity a month earlier. The average yield on the three-month T-bills came in at 0.846%, from, 0.634% at the previous auction April 24. And, the average yield on the six-month T-bills was 1.737%, from 0.580% previously.
To add to woes, the OECD stated that the Euro-zone economy may contract 0.1% in 2012, compared to the 0.2% growth projected in November.
On the economic front, consumer confidence in Euro-zone unexpectedly rose to a reading of a -19.3 in May, against the market expectation of -20.5 and compared to a revised reading of -19.9 in April.
In the Asian session, at GMT0300, the pair is trading at 1.2672, with the EUR trading marginally lower from yesterday’s close, ahead of the meeting of European leaders, on growing fears of a Greek exit from the Euro-zone.
The pair is expected to find support at 1.2609, and a fall through could take it to the next support level of 1.2546. The pair is expected to find its first resistance at 1.2772, and a rise through could take it to the next resistance level of 1.2871.
Trading trends in the pair today are expected to be determined by the release of current account data in the Euro-zone.
The currency pair is trading below its 20 Hr and 50 Hr moving averages.
