Euro Extended Gains on Greek Debt Deal Optimism - 8.3.2012

US Dollar The US currency was slightly lower in Asian trading hours today as investors boosted demand for higher-yielding assets. The dollar index fell from yesterday’s three-week high 79.92 to 79.55. At the same time US labor market continues showing signs of a moderate recovery. Yesterday ADP Employer Services reported that private non-farm companies in the US added 216000 jobs in February, following a 173000 increase in the previous month. The report was issued before the Labor Department releases its non-farm payrolls figures tomorrow. Today the data may show the number of initial jobless claims submitted in the week ended on March 3 was close to the prior value of 353000. Euro The euro accelerated yesterday’s gains versus the greenback and the Japanese yen as markets seem to be optimistic about Greek debt swap deal with private creditors. Bloomberg informed that investors holding about 60% of Greek bonds agreed on “voluntary exchange”, although the nation’s authorities indicated recently they would seek for at least 75% private sector involvement. Today the European Central Bank will announce its interest rate decision. The main refinancing rate will be probable left at 1%. After touching yesterday the lowest level since February 16 (1.3095) against the US counterpart, the euro climbed gradually to 1.3183. Japanese Yen Japanese yen was also under pressure in Asian trading hours today. Depreciation of the currency was triggered by both general market optimism and internal macroeconomic data. The Ministry of Finance reported early in the morning that Japan posted in January a record current account deficit of 437.3 billion yen. The dollar rose from yesterday’s 80.58 to 81.39 against the Japanese counterpart, while the European single currency surged from 105.70 to 107.25. Australian Dollar The aussie erased losses against the greenback during the Asian trading session. Early in the morning the Australian bureau of statistics reported that employment in Australia unexpectedly decreased by 15400 in February, following a 46300 gain in January, while unemployment rate rose to 5.2% from 5.1%. The data followed another report issued one day earlier that showed Australia’s economy expanded in the last quarter of 2011 less than economists expected. The national currency dropped in the morning to 1.0533 against the US dollar, but was driven in the aftermath above 1.0600.