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Forex - Dollar at 8-month highs against weaker euro

Posted: 7/23/2014 11:25:00 AM
Referenced Stocks: - - The dollar was steady at eight month highs against the broadly weaker euro on Wednesday as concerns that a fresh round of sanctions against Russia would have a negative impact on euro area growth pressured the single currency lower.

EUR/USD was trading at 1.3464, the lowest since November 21.

Sentiment on the single currency was hit hard by concerns that a fresh round of sanctions against Russia could have a negative impact on the growth outlook for the euro area.

The diverging monetary policy path between the European Central Bank and other central banks has weighed on the single currency since the ECB cut rates to record lows on June 5, in a bid to stave off the threat of deflation in the euro area.

EUR/JPY touched five month lows of 136.41 before easing back to 136.73.

The dollar was almost unchanged against the yen and the traditional safe haven Swiss franc, with USD/JPY inching up 0.07% to 101.52 and USD/CHF dipping 0.03% to 0.9020.

The pound edged lower, with GBP/USD slipping 0.11% to 1.7046.

Sterling showed little reaction earlier after the minutes of the Bank of England's June meeting showed that policymakers voted unanimously to keep monetary policy unchanged last month.

The minutes also said weak wage growth in the face of strong employment growth made it difficult to gauge the degree of slack in the labor market.

The Australian dollar was at one-and-a-half week highs, with AUD/USD up 0.54% to 0.9444 after stronger than expected data on underlying inflation dampened speculation over future interest rate cuts.

Elsewhere, NZD/USD eased up 0.16% to 0.8680, while USD/CAD was trading at 1.0743, up just 0.06% for the day. The pair briefly touched session lows of 1.0711 earlier after data showed that Canadian retail sales rose at a faster than expected pace in May.

The US Dollar Index, which tracks the performance of the greenback versus a basket of six other major currencies, was close to a five-week high at 80.88. offers an extensive set of professional tools for the financial markets.
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