ASIA SESSION: Dollar Falls

The EUR/USD saw late New York gains chopped down when the ratings agency Moody’s cut the bond rating of Spain near the end of the day. Earlier gains that saw highs through 1.3810 were on the back of talk that Germany and France would work on an expansion of EFSF funds, but the downgrade dropped the pair to opening Asian levels near 1.3735. The EUR/USD was not deterred by this however, as it continued to push higher until fresh daily highs were made near 1.3830 late in the day. But the moves may have been attributed to a softer dollar rather than optimistic buyers of the Euro…

The US Dollar took a hit on the back of news that Japan and Korea would expand their current currency swap arraignments. USD/KRW fell from over 1145.00 to 1128.00 seriously wounding dollar sentiment throughout Asia. The results were seen across the board as the majors all began a slow trek higher. The GBP/USD made a move from 1.5700 to 1.5765, while the AUD/USD cruised through 1.0330 after a start near 1.0240. Conversely, USD/CHF sank over 50 pips to 0.8950 and USD/CAD dropped from 1.0150 to lows just under 1.0100. The yen crosses were also boosted by gains made in the majors with EUR/JPY blasting from 105.40 to 106.10, and AUD/JPY making a climb higher from 78.60 to over 79.20. While the crosses made moves, the USD/JPY pair remained contained within a 20 pip range.

Ahead we have some data to keep an eye on with UK MPC minutes due out in London, and building permits and core CPI due out even later in New York.