By FX Empire.com
On Wednesday trading, the pair showed advance as the tensions in markets enhanced demand on the dollar as a safe haven.
Concerns aggravated the debt contagion is spreading among the euro region’s largest economies after the rise in German bond yields and decline in demand.
The euro area’s biggest economy did not manage to receive bids of 35% of the 10-year bonds, while the 30-year notes surged to two-week high where the sale came at 3.889 billion euros, below the maximum target of 6 billion euros.
Moreover, fears of facing another recession increased with the release of weak manufacturing reports which showed that the contraction in the euro zone deepened to 46.4 in Nov. from 47.1 in Oct, according to the PMI gauge.
Also, Chinese HSBC services PMI started the day with pessimism as manufacturing showed a contraction of 48.30 in Nov. from 51.1 a month before.
In theU.S., data added to worries as durable goods orders fell 0.7% from the previous 1.5% drop, personal spending recorded 0.1% advance in Oct. compared with 0.7% a month earlier and initial jobless claims showed increase to 393,000 in the week ended Nov. 19 while the prior reading was revised up to 391,000 from the initial 388,000.
On Thursday, both economies lack economic fundamentals which propose that there would be calm trading on the pair, especially due to thanks giving holiday, which is predicted to follow the general trend in market as it will not able to get direction from data.
The main focus will be probably on the latest developments from the euro area which has been grabbing investor’s attention. over the past few weeks.
Originally posted here
