Wednesday, 12 Jan 2011

Portuguese Debt Concerns Causes EUR to Tumble

The euro corrected virtually all of the gains it made in early morning trading today, as renewed concerns regarding the Portuguese debt situation have caused the common currency to fall. The EUR/USD pair had gone up over 60 pips earlier today, peaking at the 1.3043 level. The pair has since fallen over 70 pips and is currnetly trading just below the 1.2970 level. Against the JPY, the euro did not fare much better. The EUR/JPY pair has fallen close to 40 pips in the last hour alone, and is currently trading around the 108.00 level.

Turning to the rest of the day, traders will want to pay attention to the US Crude Oil Inventory figure, set to be released at 15:30 GMT. The price of crude oil has dropped today as investors are returning to the safe-haven currencies. Analysts are predicting today's inventories figure to come in around 0.4M, which if true, would signal an increase in supplies and could cause prices to drop below the $90.00 level.