AGL 38.80 Increased By ▲ 0.65 (1.7%)
AIRLINK 129.49 Increased By ▲ 4.42 (3.53%)
BOP 7.18 Increased By ▲ 0.33 (4.82%)
CNERGY 4.60 Increased By ▲ 0.15 (3.37%)
DCL 8.25 Increased By ▲ 0.34 (4.3%)
DFML 38.51 Increased By ▲ 1.17 (3.13%)
DGKC 79.97 Increased By ▲ 2.20 (2.83%)
FCCL 32.20 Increased By ▲ 1.62 (5.3%)
FFBL 72.00 Increased By ▲ 3.14 (4.56%)
FFL 12.20 Increased By ▲ 0.34 (2.87%)
HUBC 109.00 Increased By ▲ 4.50 (4.31%)
HUMNL 14.06 Increased By ▲ 0.57 (4.23%)
KEL 4.90 Increased By ▲ 0.25 (5.38%)
KOSM 7.54 Increased By ▲ 0.37 (5.16%)
MLCF 37.38 Increased By ▲ 0.94 (2.58%)
NBP 70.40 Increased By ▲ 4.48 (6.8%)
OGDC 187.37 Increased By ▲ 7.84 (4.37%)
PAEL 24.80 Increased By ▲ 0.37 (1.51%)
PIBTL 7.36 Increased By ▲ 0.21 (2.94%)
PPL 150.50 Increased By ▲ 6.80 (4.73%)
PRL 25.06 Increased By ▲ 0.74 (3.04%)
PTC 17.47 Increased By ▲ 1.07 (6.52%)
SEARL 80.75 Increased By ▲ 2.18 (2.77%)
TELE 7.55 Increased By ▲ 0.33 (4.57%)
TOMCL 33.14 Increased By ▲ 1.17 (3.66%)
TPLP 8.48 Increased By ▲ 0.35 (4.31%)
TREET 16.65 Increased By ▲ 0.52 (3.22%)
TRG 56.30 Increased By ▲ 1.64 (3%)
UNITY 28.12 Increased By ▲ 0.62 (2.25%)
WTL 1.35 Increased By ▲ 0.06 (4.65%)
BR100 10,439 Increased By 350.1 (3.47%)
BR30 30,852 Increased By 1343.5 (4.55%)
KSE100 97,990 Increased By 3415.4 (3.61%)
KSE30 30,513 Increased By 1068.1 (3.63%)

The euro hovered below three-week highs against the dollar on Friday, holding steady on expectations that global central banks will step in to counter any adverse fallout from Sunday's election in Greece.
G20 officials told Reuters that central banks from major economies stand ready to take steps to stabilise financial markets by providing liquidity and preventing a credit squeeze if the Greek election result roils markets. A co-ordinated action is likely to support risk appetite and provide relief to the euro although any bounce could prove temporary given Spain's elevated borrowing costs and the risk of contagion to Italy, the euro zone's third largest economy.
The dollar was also under pressure on expectations the US Federal Reserve may resort to further monetary easing after labour market data disappointed and consumer prices fell in May.
The euro dipped 0.1 percent on the day to $1.2619, still within sight of Monday's three-week high of $1.2672, struck after a 100 billion euro aid package for Spanish banks was agreed at the weekend. The dollar index fell to a three-week low of 81.703 against a basket of currencies.
Much of how the euro will trade in the near term depends on the outcome of the Greek election on Sunday. Traders cited offers to sell above $1.2660 up to $1.2670 while option expiries were cited at $1.2600.
"Investors will be reluctant to hold any meaningful positions either way going into the weekend," said Ankita Dudani, G10 currency strategist at RBS.
"The euro has come back from highs around $1.2650 and the only reason it will hold above $1.2500 is because of the extreme bearish positions and hopes of co-ordinated central bank action."
Hopes for more policy steps by major central banks were heightened after the UK government and the Bank of England unveiled a 100 billion pound ($155 billion) funding scheme for banks to boost credit on Thursday.
Traders said the euro had scope to post short term gains if Greece's pro-bailout parties manage to win a majority in Sunday's election. In a scenario where the far-left anti-bailout parties win, the euro could drop towards near two-year lows of $1.2288 struck earlier this month.
The uncertainty was reflected in the options market, where both one-week and one-month implied volatilities traded at elevated levels of 16.50 percent and 12.65 respectively, up from around 9.8 percent and 11.55 percent at the end of last week. The dollar fell 0.8 percent to 78.77 yen, while the euro dropped 1 percent on the day to 99.10 yen.

Copyright Reuters, 2012

Comments

Comments are closed.