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Euro Summary-New York

Posted by Joseph Trevisani on Jan 21, 2014 8:00:00 PM

The euro opened at 1.3523 toward the lower end of a 1.3515-1.3567 combined Tokyo and London range. The German ZEW survey for January was mixed, sentiment lighter than expected 61.7 vs 64.0, and current situation stronger, 73.3 vs. 70.2. A Wall Street Journal piece from Fed reporter Jon Hilsenrath stated that he expected the Fed to reduce its purchases by another $10 billion to $65B at next week's FOMC meeting, the last of Ben Bernanke's chairmanship.

There was no U.S. data today or speakers, with many government officials and journalists gathered in Davos Switzerland  for the World Economic Forum. The euro drifted higher at first finding sellers at 1.3540 and then slipped back to 1.3527.

U.S. Treasury yields came lower after posting higher in European trading and that kept mild pressure on the dollar and brought the euro up to 1.3545, just beyond the European high. Another drop to 1.3535 found bids, and this time the euro managed to reach 1.3558 just after the 4:00 pm London fix. The euro was helped by a lower U.S. yields near the close on Friday, and a sharp drop in American equities, with the Dow breaking support at 16,375, it closed off 44 points at 16,414. The combination pushed to euro to 1.3567, the U.S high but the volatility was short lived and the pair fell off again to 1.3550 to close at 1.3560.  Liquidity became progressively worse as the afternoon wore on with traders leaving their desks early due to the accumulating snow.

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