(MENAFN– ecpulse)
FX markets are dominated by risk sentiment again ahead amid updates from the euro area, as traders cheered news of an agreed coalition treaty between Germany`s two largest parties after Chancellor gives ground on minimum wage and rent controls.
The dollar slipped to one-month lows against the euro on Wednesday, but traded to almost six month highs against the yen in thin trade ahead of the US thanksgiving holiday on Thursday.
In Italy, markets await the possible ouster of ex-premier Silvio Berlusconi over a tax fraud conviction, as the government seeks an end of political instability facing the bloc`s third largest economy. Prime Minister Enrico Letta won a confidence vote on the 2014 budget yesterday. However, the fate of Berlusconi remains the focus for the day.
The euro was supported by Letta`s confidence vote. The EUR/USD rose as much as 1.3612 and trading around 1.3603 as of 12:11 GMT+3 compared with a session low of 1.3557 and opening at 1.3570. The pair is trying to breach key resistance at 1.3615 towards 1.3785 then 1.3815.
The euro also rose for the fifth day against its Japanese counterpart following the news of German coalition deal. The EUR/JPY ticked higher to 138.44 yen as of 12:11 GMT+3, from a session high of 1.38.50 and low of 137.27 from the opening at 137.43.
The sterling pound rose nearly to ten-month high against the dollar after official data showed that preliminary Gross Domestic Product was unchanged as expected at 0.8% growth in the third quarter and 1.5% from a year ago quarter.
As of 12:12 GMT+3, the GBP/USD traded around 1.3286, after hitting a multi month high of 1.6293 from a session low of 1.6296 and opening at 1.6207. Technically, stability above 1.6290 levels if breached will help the pair carry on the bullish bias.
Eyes will closely watching a raft of US data due to be released today including October durable goods orders, November Chicago PMI and final reading for University of Michigan confidence.
Meanwhile, the greenback is running under the heels of stronger euro, especially with high expectations of weaker growth in US durable goods orders last month.
The USDIX fell to 80.52 from 81.11, after posting intraday high of 81.11 and low of 80.46. Technically, stability above resistance level at 80.40 if broken then 80.35 will further confirm the downside movement.
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