Session Recap: Dollar reverses early gains

FXStreet (Córdoba) - Japan's downgrade by Moody’s set the tone of the session, as a strong rejection of USD/JPY from fresh 7-year highs above 119.00, weakened the greenback across the board.

Moody's downgraded Japan's sovereign debt rating to A1 from Aa3 citing uncertainty over the ability to meet its debt-reduction goal. USD/JPY reached a fresh high of 119.13 as the knee-jerk reaction, but was heavily sold-off afterward, giving up more than 100 pips.

EUR/USD holds near daily highs despite disappointing Eurozone PMIs, while GBP/USD staged an impressive comeback beyond 1.5700 from a fresh 1-year low of 1.5584.

Meanwhile commodity currencies managed to reverse early losses moving in tandem with gold and oil prices. Gold fell as low as $1142/oz after the gold initiative was rejected in Switzerland, but managed to climb back to $1184/oz.

Main Headlines in Europe:

What’s the sentiment around EUR/USD today? – Commerzbank and OCBC Bank

Germany Markit Manufacturing PMI below expectations (50) in November: Actual (49.5)

European Monetary Union Markit Manufacturing PMI came in at 50.1, below expectations (50.4) in November

UK manufacturing PMI climbs to four-month high in November

Gold recovers losses as US dollar weakens

Moody's cuts Japan's credit rating over heightened uncertainty over fiscal deficit reduction goals

ECB meeting and payrolls to be the highlights this week – TDS

EUR/JPY to rise above 150.00 if the ECB fails to deliver - FXStreet

FXStreet Editor and Analyst Omkar Godbole, notes that the EUR/JPY pair gained 4.65% to end higher at 147.62 in November after the BOJ announced a surprise expansion of its monetary stimulus program on Oct. 31st, and anticipates it to rise to 150 if the ECB fails to deliver a policy change announcement this week.
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