The euro touched the lowest level
against the dollar in six weeks after the European Central Bank
said institutions will repay less of Long-Term Refinancing
Operation borrowing next week than economists forecast.
The 17-nation currency trimmed gains versus the yen as the
European Commission forecast the region’s economy will shrink
for a second year in 2013. The Australian dollar rose the most
in seven weeks after central bank Governor Glenn Stevens said
the bar for intervention was high. Japan’s currency weakened
amid a White House meeting between Prime Minister Shinzo Abe and
President Barack Obama, who made no mention of the yen during
remarks after the discussion.
“The market is trading on confidence and sentiment, and
the LTRO news shows that tail risk has shrunk less than we
thought,” Greg Anderson, New York-based head of Group of 10
currency strategy at Citigroup Inc., said in a telephone
interview.
“What we’ve seen this week is the last of the euro
longs getting squeezed out.” A long position is a bet that an
asset will rise.
The euro fell was little changed at $1.3194 at 5 p.m. in
New York after touching $1.3145, the lowest level since Jan. 10.
The shared currency declined 1.2 percent this week. It rose 0.3
percent 123.22 yen today after strengthening as much as 0.8
percent. The yen weakened 0.3 percent to 93.42 per dollar.
The euro may depreciate to the 2013 low of $1.2998 it
reached on Jan. 4 if it declines past a support level at
$1.3151, Cilline Bain, a London-based technical analyst at
Credit Suisse, wrote today in a client note. Support is an area
on a chart where buy orders may be clustered.
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