Thursday, 7 Apr 2011

Euro Sinks against Majors

The euro fell against most of its major currency counterparts on Thursday after the European Central Bank raised rates but signaled it was not necessarily the start of a round of hikes, while European shares rose on hopes the region's debt crisis will be stanched. The EUR is currently trading lower against the JPY by nearly 50 pips at 121.50. It is also trading lower against the CHF and GBP

The ECB raised rates by 25 basis points to 1.25 percent to counter firming inflation pressures. ECB President Jean-Claude Trichet said it was not necessarily the start of a series of similar steps, disappointing some who had expected a more hawkish tone.

As for tomorrow, many impacting economic indicators are expected from the Europe economy. Traders are advised to pay special attention to two leading indicators, the German Trade Balance and British PPI Input. A positive result from both this indicators might boost the EUR and GBP in short term.