Euro Climbs On Risk Appetite
Canbera-Australia (Jan 19) The euro climbed against its major counterparts in European deals on Monday, as European stocks rose on mounting expectations that the European Central Bank is ready embark quantitative easing program at its upcoming policy meeting this week.
Interim ruling by the European Court of Justice ' aid last week that the central bank's bond purchase program is legal is seen as an endorsement for ECB's stimulus plan.
With the bloc experiencing stubbornly low inflation and weak growth, economists are predicting that the ECB's governing council would vote for the purchase of sovereign bonds worth EUR500 billion or more.
In economic news, Eurozone's current account surplus for November declined from a year ago, figures from the European Central Bank showed.
The current account surplus decreased to EUR 18.1 billion from EUR 19.5 billion in the same month last year. In October, the surplus was EUR 19.5 billion .
The euro advanced to 0.7664 against the Sterling and 1.1616 against the greenback, off early lows of 0.7626 and 1.1549, respectively. The next possible resistance for the euro is seen around 0.78 against the Sterling and 1.18 against the greenback.
The single currency strengthened to a 4-day high of 136.29 against the yen, rebounding from an early low of 135.12. If the euro extends rise, 137.00 is possibly seen as its next resistance level.
Japan's industrial production declined less than initially estimated in November, final figures from the Ministry of Economy and Trade and Industry showed.
Industrial production dropped a seasonally adjusted 0.5% month-on-month in November, revised from a 0.6% fall. In October, production grew 0.4%.
Recovering from an early low of 0.9857 against the Swiss currency, the euro edged up to 1.0076. Continuation of euro's uptrend may lead it to a resistance around the 1.20 zone.
Switzerland's producer and import prices declined less than expected in December, data from the Federal Statistical Office revealed.
The producer and import price index declined 2.1%, faster than the 1.6% decrease seen in November. The index has declined for the 15th consecutive month.
The euro that dropped to 1.3809 against the loonie, 1.4027 against the aussie and 1.4890 against the kiwi in early deals changed direction and ticked up to 1.3904, 1.4155 and 1.4909, respectively. The next possible resistance for the euro is seen around 1.40 against the loonie, 1.42 against the aussie and 1.565 against the kiwi.
The US financial markets will be closed today in observance of Martin Luther King Day .