August 29, 2014

Brief Information about Foreign Exchange Rate Movement

 

 New York Market

 

EUR/USD dropped 0.08% to 1.3182. Traders put up bearish bets on the euro ahead of today’s CPI data release after yesterday’s data showed Germany's inflation steadied at a very low level whereas Spanish prices fell, suggesting there is risk that Eurozone’s rate will come in lower than the 0.3% forecast. The euro has dropped 1.6% so far in August vs a 2.2% drop last month.

USD/JPY closed lower by 0.15% to 103.72, well off a recent high of 104.49. The yen held firmly while the dollar gained against a broad basket of major currencies after the incursion of Russian convoy into Ukraine soil prompted separatists in Eastern Ukraine to gain ground in fighting.

 

 Asian Market

   

Asian currencies mostly weakened against the dollar. The rupiah lowered on dollar demand from importers for month-end payment. The peso rose to its strongest level in 3 weeks after its Q2 GDP topped market expectations, prompting inflows to bet on another rate hike ahead of the BSP’s MPC decision next month. Risk/commodity currencies such as the AUD and CAD have been remarkably resilient. The Aussie marched to its own beat this month, rising against almost every major currencies. The Reserve Bank of Australia's steady policy stance and recent set of reasonable data have kept Aussie bulls in play. Yet, GDP data next Wednesday could show the economy shrank in Q2. We think Asian currencies might become under weakening pressure today after flaring Ukraine tensions ruined investors’ risk appetite.

USD/THB rose 0.12% to 31.95. Offshore funds continued to buy Thai bonds with a net buy of THB799mn whereas month-end dollar demand from importers also faded, supporting the baht to remain below 32.00. Local banks took profit from the currency's gains, limiting the baht upside.

 

    Today Market Direction at 8.30 A.M.

 

KBank Technical Analysis

Morning

Rate

Support

Resistance

Trend (Major)

Today's Strategy

USD/THB (Onshore)

31.98

31.90

32.05

Sideway

Sell USD near resistance

USD/JPY

103.7

103.45

104.00

Sideway

Buy USD near support

EUR/USD

1.3180

1.3155

1.3210

Sideway

Sell EUR near resistance

EUR/THB

42.07

41.85

42.45

Sideway

Sell EUR near resistance

JPY/THB

0.3075

0.3057

0.3107

Sideway

Sell JPY near resistance

                          

 

Foreign Exchange Market News
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