Market Review - 21/04/2010 21:12GMT

Euro declines broadly on possible delay of aid for Greece

The euro weakened against the dollar as worries over Greece continued while Germany's main opposition party threatened on Wednesday to challenge the approval of aid for Greece, which might delay the bailout for weeks.

Despite a brief recovery fm 1.3447 to 1.3447 at European opening, the single currency remained under pressure throughout Wednesday on Greek concerns as Greek/German 10-year govt. bond yield spread rose to a 12-year high of 502 basis points and the euro tumbled to a low of 1.3358 in European afternoon before staging a minor rebound on short-covering.

The British pound moved sideways in Asia session on Wednesday and rose to an intra-day high of 1.5441 after the release of BOE minutes together with stronger-than-expected jobs data. U.K. claimant count fell by 32,900 versus forecast of decrease of 10,000 whilst unemployment rate decreased to 4.8% against economists' expectation of 4.9%, the lowest rate since June 2009. Minutes of their April 7-8 meeting published showed a 9-0 vote for keeping interest rates at a record low of 0.5% and maintaining the stock of asset purchases financed by the issuance of central bank reserves at 200 billion pounds. Despite sterling's brief rise to said 1.5441 high in European mid-day from 1.5332, cable eased fm there n traded narrowly in NY session. Cross buying in the pound versus euro also helped to lift cable as eur/gbp breached daily support at 0.8705 n fell to as low as 0.8684 fm 0.8749.

Economic data to be released on Thursday include: Japan Trade balance, Swiss Trade balance, Germany Manufacturing PMI, Services PMI, EU Manufacturing PMI, Services PMI, U.K. Retail sales, Swiss ZEW index, U.S. Jobless claims, PPI, Existing home sales, Canada Leading indicators.