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The forecasts of Mr. Draghi put strong pressure on the Euro sending it to deep lows against its rivals

December 7, 2012, Friday, 12:16 GMT | 07:16 EST | 16:46 IST | 19:16 SGT
Contributed by Forex-Metal

Asian and European trading sessions:

Euro: The euro grew against the dollar during the European session after the decision of the ECB to leave key interest rate unchanged at 0.75 % has been announced. The decision was in line with the forecast. The EUR / USD pair rose to $ 1.3086 area.

British Pound: The British pound after trading in a narrow range against the dollar grew amid data showing that Britain's trade deficit rose to £9.539 billion from £8.439 billion for the previous month widening more than expected and driven by a sharp fall in exports to countries outside of the EU as well as due to the increase of imports from USA. In addition, the today’s decision of Bank of England on leaving the key interest rate unchanged at 0, 5% and the amount of the program of asset purchases at around £375 billion pounds provided some support to the National currency. The GBP / USD pair rose to $ 1.6127 during the European session.

Japanese Yen: The yen strengthened against most major currencies as investors increased demand for safe heaven assets. The USD / JPY pair fell to Y82.33 during the European session.

New Zealand dollar: After the Reserve Bank of the New Zealand left the interest rate unchanged at 2.5% noticing that the country’s economy growth is likely to accelerate the “kiwi” rose to a two-month high against the dollar.

American trading session:

Euro: The euro fell sharply against its competitors and the EUR / USD pair sunk down to $ 1.2950 area. after the European Central Bank President, Mario Draghi said that the European economy weakness will continue in the next year commenting that he sees "risks" for the region, and therefore, mentioning that the central bank may lower interest rates in the nearest future. Also, Mr. Draghi said that the ECB predicts that economy will shrink by 0.5 % this year, slightly more than the 0.4% reduction about which was originally reported in September. In addition, the ECB lowered its inflation forecast for next year to 1.6% from 1.9 %. The report on the gross domestic product in the euro zone recorded decline by 0.1 % in the third quarter, compared with a fall of 0.2% in the previous three months.

British Pound: The currency could not hold its highs, which were reached against the dollar and dramatically collapsed, the GBP / USD pair dropped to $ 1.6038 level due to lowering growth forecasts for the European economy by the ECB.

U.S. Dollar: The dollar rocketed, the dollar index, which is used to track the value of the dollar against the currencies of six U.S. partners, rose by 0.7% to 80.298 on forecasts of president of ECB.

Gold: The price of December gold futures jumped above 1700 per troy ounce on COMEX. The investors' appetite for physical gold and physical securities investment products remains high, while in one of the largest gold ETF SPDR Gold Trust, it remains at a record level.

Oil: The cost of oil fell to deep lows on the comments of the ECB as well as the background of the fact that U.S. lawmakers could not still reach an agreement on the budget plan. The January futures price of WTI fell to 85.65 dollars per barrel on the New York Mercantile Exchange.