Forex Magnum

The euro (EUR) rallied to 1.2627 from 1.2407 today against the US dollar following the EU summit. EU leaders agreed to spend 120 billion euro to stimulate growth and create new jobs. It was also agreed to emergency action to lower the borrowing costs of Italy and Spain stabilizing the bond markets without the need for the countries to adopt additional austerity measures. The leaders also decided that the European Stability Mechanism (ESM) would be able to lend directly to the banks without increasing a country’s budget deficit further improving sentiment in the market. But the euro may be under pressure after the initial euphoria from the summit fades and as investors are following on tomorrow’s Chinese manufacturing figures. Eurozone Consumer Price Index is due today.

The US dollar (USD) weakened against a basket of currencies on a lower demand for the safe haven currency. Versus the safe haven Japanese yen (JPY), the greenback fell to 79.13 from 79.68. Yesterday’s US jobs data showed the US job market is still recovering but all eyes will be on the US Non Farm Payrolls on July 6. Attention turns to the US Purchasing Managers’ Index as well as Consumer Sentiment Index due today.

The British pound (GBP) rose against the greenback to 1.5646 from 1.5484 following the positive progress of the EU summit. Economic data showed the UK Gross Domestic Product fell 0.2% during the first quarter of 2012. Attention shifts to the UK Financial Stability Report due at 09:30 GMT.

Oil edged lower to 77.27 dollars a barrel from 80.82 and today it bounced up to 79.97. Gold (XAU) slid to 1547.79 dollars an ounce from 1578.97 and against the euro it fell to 1247.65 from 1262.54. Silver (XAG) fell to 26.09 dollars an ounce from 27.14 and later climbed back to 26.98. Stay in tune throughout the day with foreign exchange bullets!

Equities	EUROPE				US				ASIA3
	FTSE 100	-0.56%	▼		S&P 500	-0.21%	▼		NIKKEI	1.62%
	DAX	-1.27%	▼		DJIA	-0.20%	▼		HIS	2.15%
	CAC	-0.37%	▼		NASDAQ	-0.90%	▼		CSI 300	1.17%

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