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Euro Peaks High against Dollar as Rate Cut is Slow

by shahid hussain on Monday, April 6, 2009,

EUR/USD rose at a very fast pace today, posting the biggest daily gain since March 18 so far. Mixed news on the U.S. fundamental indicators didn’t affect the trading much as the Forex traders looked at the ECB’s rate cutting action. EUR/USD is currently trading near 1.3413.

Last week initial jobless claims were reported at 669k, which is 12k above than 657k (revised up from 652k). Traders expected a small decline to 650k, but the employment sector is still in its worse state in U.S.

Factory orders increased by 1.8% in February — for the first time after six months of decline (in January they decreased by 3.5%). The forecasts showed 1.5% growth for February.

European Central Bank cut the Eurozone interest rate from 1.5% to 1.25% today, while the markets were almost sure that the rate will be slashed to 1%. This caused a lot of optimism for euro bulls and the currency is dominating the market at this moment.


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