Europe

The Euro was little moved versus the U.S currency after being under pressure this week amid the diverging policy stance and speculation that the U.S may raise interest rates earlier than markets expect next year. The currency fetched $1.3535, faintly up from yesterday when it tumbled to a 5-1/2 month low. Against its Japanese peer, it rose 0.3% to 137.2683 after plunging below the 136.75 level for the time since mid-November 2013.

Sterling strengthened as traders turn to next week’s UK economic data flow which could increase the chances of an interest rate rise this year. The minutes of the BOE June meeting may provide an insight regarding the need for policy tightening while the retail sales figures followed by the GDP data will paint a picture of the health of UK’s economy. The Pound was up almost 0.1% to $1.7113 and traded little changed versus the bloc’s currency at 1.2643 Euro. It last fetched 173.5175 Yen, up 0.3% from late U.S trades when it fell to 172.7784 Yen, its weakest level since Jun.30.

North America

The U.S Dollar lowered but remained near multi-week highs as risk appetite picks up. The Greenback added 0.25% to 101.4251 Yen after falling as low as 101.1257 as investors turned to safer assets after a Malaysian commercial airline crashed in a pro-Russian rebels-held area in Ukraine and Israel confirmed that a ground military operation has been launched to Gaza. Against the 18-nation currency, it traded little changed at $1.3535 after falling as low as $1.3513, a level unseen since Feb.02. Investors are awaiting the Thomson Reuters/University of Michigan’s preliminary sentiment index which economists expect rose to 83 in July from 82.5 the previous month.

Around the world

The Yen erased some of its earlier gains as demand for haven assets waned. It was also pressured by BOJ minutes of its latest policy meeting which provided no fresh cues about its monetary easing. Japan’s currency climbed to multi-month highs versus both the Euro and the Dollar amid rising geopolitical risk. Demand for the safe haven Yen got a boost after the downing of a Malaysian plane over Ukraine and escalating violence in the Gaza strip. It slid 0.25% to 101.4251 per Dollar after touching 101.1257, the strongest level since Feb.03. The Yen was poised for a 0.6% advance this week. Against the single currency, it soared to 136.7450 per Euro, unseen since Nov.20, before standing at 137.2683 per Euro, down 0.3% from late U.S hours. It has gained almost 0.9% since last week.

Australia’s Dollar recouped some of yesterday’s losses incurred amid fears that the Malaysian Airlines flight was shot down in a missile attack. The so-called Aussie inched up 0.2% to $0.9369 after dropping as low as $0.9337, just a nudge above its 6-week low hit on Wednesday. It added 0.2% to 669.27 Euro cents. The Australian Dollar plummeted to a 7-week trough of 94.4468 Yen following the news as a “sell first and ask questions later” reaction emerged. It last stood at 94.5946 Yen, up 0.4% from yesterday’s close.

New Zealand’s Dollar rallied after touching multi-week lows as investors flew for safety after Ukraine said the Malaysian plane was shot down by pro-Russian rebels. The Kiwi edged up 0.2% to $0.8684 after plunging to $0.8653 unseen since Jun.11. Against the shared currency, it rose 0.25% to 64.25 Euro cents, having declined to 64.00 cents overnight, the least since Jul.01. New Zealand’s Dollar appreciated 0.4% to 88.0599 Yen, moving away from its 5 week trough hit yesterday.

Interbank Rates
GBP/EUR    1.26434
GBP/USD    1.71106
GBP/JPY    173.534
EUR/USD    1.35333
EUR/JPY    137.253
USD/AUD    1.06570
USD/CAD    1.07534
USD/NZD    1.15217
USD/JPY    101.418