The currency markets have been gripped by risk aversion into the New Year, and we are seeing a big reversal in especially in dollar/yen and euro/dollar pairs.
Investors favored covering yen shorts, giving the Japanese currency a 0.5% gains versus the greenback today.
Profit-taking saw the USDJPY pair being unwound after being taken to fresh five-year highs of 104.43 at the open of the first trading day of 2014. The pair took a sharp tumble since yesterday to as low as 104.06, which is currently holding as a key support area.
The yen also made gains against the euro. EURJPY retreated 0.66% to 142.31, moving further away from a 5-year peak.
Negative market sentiment is also being weighed down by soft Chinese data against today. The non-manufacturing (services sector) PMI slipped to a 4-month low in December to 54.6 from 56.0 in November.
The euro bears gained traction and kept EURUSD weak after yesterday’s tumble. The pair opened the Asian session today at $1.3670 after selling off during the US session. Euro is poised for a 0.7% decline on the week.
The pound fell steadily to lows near $1.6410 today. Yesterday, the pound was trading at $1.6565 when weaker than expected UK manufacturing PMI data was released and hurt the currency.
AUDUSD traded down to 0.8886 after China services PMI came in lower than last month but aussie managed to bounce back.
Investors favored covering yen shorts, giving the Japanese currency a 0.5% gains versus the greenback today.
Profit-taking saw the USDJPY pair being unwound after being taken to fresh five-year highs of 104.43 at the open of the first trading day of 2014. The pair took a sharp tumble since yesterday to as low as 104.06, which is currently holding as a key support area.
The yen also made gains against the euro. EURJPY retreated 0.66% to 142.31, moving further away from a 5-year peak.
Negative market sentiment is also being weighed down by soft Chinese data against today. The non-manufacturing (services sector) PMI slipped to a 4-month low in December to 54.6 from 56.0 in November.
The euro bears gained traction and kept EURUSD weak after yesterday’s tumble. The pair opened the Asian session today at $1.3670 after selling off during the US session. Euro is poised for a 0.7% decline on the week.
The pound fell steadily to lows near $1.6410 today. Yesterday, the pound was trading at $1.6565 when weaker than expected UK manufacturing PMI data was released and hurt the currency.
AUDUSD traded down to 0.8886 after China services PMI came in lower than last month but aussie managed to bounce back.