Investing.com – The euro rebounded from a 2-month low against the yen on Wednesday, posting sharp gains as the cost of insuring euro-zone sovereign debt against default fell back.
EUR/JPY hit 109.89 during European morning trade, the daily high; the pair subsequently consolidated at 109.77, jumping 1.03%.
The pair was likely to find support at 108.33, Tuesday’s low and resistance at 110.68, Tuesday’s high.
After hitting record highs Tuesday, Spanish 10-year yield spreads to bunds saw the biggest improvement, narrowing 0.27%, while Italian 10-year bund spreads were down 0.18%. Belgian, Portuguese, and Irish bund spreads were also lower.
On Tuesday, the president of the European Central Bank, Jean-Claude Trichet indicated that governments were determined to defend the single currency.
“I don’t believe that financial stability in the euro zone could really be called into question” Trichet said. Observers “are tending to underestimate the determination of governments.”
The euro was also sharply higher against the U.S. dollar, with EUR/USD surging 0.94% to hit 1.3104.
Also Wednesday, official data showed that German retail sales rose significantly more-than-expected in October, hitting a 3-month high.
EUR/JPY hit 109.89 during European morning trade, the daily high; the pair subsequently consolidated at 109.77, jumping 1.03%.
The pair was likely to find support at 108.33, Tuesday’s low and resistance at 110.68, Tuesday’s high.
After hitting record highs Tuesday, Spanish 10-year yield spreads to bunds saw the biggest improvement, narrowing 0.27%, while Italian 10-year bund spreads were down 0.18%. Belgian, Portuguese, and Irish bund spreads were also lower.
On Tuesday, the president of the European Central Bank, Jean-Claude Trichet indicated that governments were determined to defend the single currency.
“I don’t believe that financial stability in the euro zone could really be called into question” Trichet said. Observers “are tending to underestimate the determination of governments.”
The euro was also sharply higher against the U.S. dollar, with EUR/USD surging 0.94% to hit 1.3104.
Also Wednesday, official data showed that German retail sales rose significantly more-than-expected in October, hitting a 3-month high.