Monday, 2 Aug 2010

EUR/USD Hits 3-Month High

Positive manufacturing data from both the U.K. and U.S. helped elevate EUR/USD to a 3-month high in evening trading today. The better than forecasted data caused investor confidence in the global economic recovery to soar and led to the dollar tumbling. EUR/USD has gone up over 100 pips since this afternoon, and is currently trading around the 1.3175 level. Meanwhile, the U.K. pound also saw a very profitable day today, moving up around 115 pips against the yen and 150 pips against the dollar since this morning.

Tomorrow, traders will want to pay attention to several economic indicators that are likely to generate market volatility. The most impacting is likely to be the U.S. Pending Home Sales figure, set to be announced at 14:00 GMT. Analysts are forecasting a substantial increase in sales over last month. If the predictions turn out to be true, riskier currencies will likely be able to extend their gains, as confidence in the global economic recovery will likely increase.