Dollar Strengthens on Risk Aversion and Euro Concern
Posted by cvbasheer on January 20, 2010
Risk aversion drives market in Asian today on news that China has told banks to limit lending to restrict overall credit growth. Weaker than expected CPI report from New Zealand also put some pressure on both Aussie and Kiwi. Meanwhile, Euro remains the weakest currency this week and dives through 1.4217 support against dollar and is now pressing 0.8700 level against Sterling. EUR/USD’s break of 1.4217 serves as an early alert that dollar is staging a broad based rebound and we’d expect Euro’s weakness to be spread over to broad based dollar rally in near term if dollar index breaks 78.19 resistance.