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Euro Retreats As European Officials Meet

Published 12/06/2010, 09:34 AM
Updated 12/06/2010, 10:08 AM
USD/CAD
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The euro slipped against the US dollar and other major currencies as European Finance Ministers meet today in Brussels.

European officials will seek to jolt the euro area out of its financial crisis through preventing the debt contagion from spreading to other highly indebted nations in the 16 economies using the shared currency.

Officials will discuss the possibility of enlarging the 750 billion-euro lifeline package announced in May, introduction of joint European bonds and to approve Ireland's 85 billion-euro surveillance package.

However, the split among member states is raising concerns, thereby causing the euro to halt its rebound that started last week. While some leaders agree with expanding the 750 billion-euro package and issuing joint European bonds, others, more specifically Germany and France, reject these ideas as they see that debt-trapped economies must depend on themselves in solving their problems rather than relying on external aids.

On the other hand, the dollar resumed its advance against majors today in the absence of economic fundamentals from the United States and Europe and after Bernanke said the US economy most probably will not fall back into recession, referring that QE2 may be expanded.

The data released so far was building permits from Canada which slipped 6.5% in October from a revised 14.9% advance in September, pushing the USDCAD pair up to touch a high of 1.0081 from the day's opening at 1.0034.

The dollar index, which tracks the movements of the greenback versus six major currencies, climbed to a high of 79.96 from the day's opening price at 79.31.

Concerning the euro-dollar pair, it slipped on a daily basis paring some of gains incurred over the prior three sessions after facing resistance at 1.3368.

Meanwhile, the pair is trading at 1.3256 after recording a high of 1.3422 and a low of 1.3244, while the trading range for today is among the key support at 1.3185 and the key resistance at 1.3685.

Moving to the royal pair, it is showing decline as it dipped to a low of 1.5653 while the highest point was hit at 1.5773, whereas the trading range for today is among the key support at 1.5510 and the key resistance at 1.6075.

With regard to the dollar-yen pair, it pared some of the previous two session's sharp drops to reach a high of 82.99 while the day's low was recorded at 82.62.

The trading range for today is among the key support at 81.05 and the key resistance at 85.95.

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