The European session on Thursday was lively as focus temporarily shifted away from US politics and the US dollar and Euro and Sterling took the spotlight.
The pound fell from a one-week high against the dollar after data showed soft UK GDP and a wider than expected current-account deficit. This raises concern that the country’s road to recovery continues to rough.
GBPUSD dropped to $1.6035 from $1.6094.
The euro fell after reacting to news on Italian politics. Ex-Prime Minister Berlusconi's supporters threaten to resign as the Italian Senate considers his expulsion, making the coalition government fragile.
EURUSD tumbled to a session low of $ 1.3482, down from an earlier session high of $1.3525.
The yen weakened for the first time in five days against the dollar today on speculation that Japan will cut corporate taxes. This made shares rally since the tax cut will make companies more profitable. When Japanese equity markets rise, yen tends to fall since they have an inverse correlation.
Whenever it’s seen as a “risk-on”, then the safe have yen is sold off.
USDJPY was propelled to a high of 99.10 in Asia and went into early US session just above 98.75.
Focus is now on US economic data in the upcoming New York session. Second quarter US GDP is due. Other economic data out is Pending home sales figures for August, a reading of manufacturing activity in the Midwestern US and initial jobless claims numbers from the US labor department.Publication source