Forex: EUR/USD stabilizes around 1.3330

The euro decline found some bidding interest in the proximities of 1.3330 on Wednesday, after softer-than-expected GDP releases in the euro area accelerated the downside from levels above 1.3400

“The euro's drop today indicates the downside correction to the euro that began earlier this month is not complete. A break of $1.3310 signals a potentially quick move toward $1.3270”, suggested Marc Chandler, analyst at Brown Brothers Harriman.

At the moment, the pair is losing 0.92% at 1.3327 and a dip below the psychological mark at 1.3300 would expose 1.3265 (low Jan.23) and the 1.3251 (Lower Bollinger).
On the flip side, resistance levels line up at 1.3442 (MA21d) ahead of 1.3472 (MA10d) and finally 1.3520 (high Feb13).

Feb 14, 2013

Forex: GBP/USD holds up above 1.5500

The downside pressure went no further than 1.5492 low, allowing the GBP/USD to bounce back above the 1.5500 psychological level. Throughout most of the London morning, the pair remained close and testing the handle, but a steady move lower was constantly rejected.

Forex Flash: HUF performance may become hurdle for the MPC – TD Securities

TD Securities analysts say that the HUF performance could become a serious hurdle for the MPC to overcome if they decide to continue easing, as inflation falls on the heels of favorable base effects and close to non-existent domestic private demand. "The double GDP & CPI data release today showed that the slowdown in economic activity continued in Q4 and was deeper than expected, revealing a sharp drop in domestic demand as the main driver of disinflation in the recent months”, wrote analyst Cristian Maggio, pointing to the GDP at -2.7% Y/Y in Q4, down from -1.5% in Q3, and below consensus of –1.9%. “Weak Q4 data implied that the Hungarian economy contracted by 1.7% in 2012, 0.2ppt below our estimate of -1.5%”, Maggio added, saying that CPI continued to decelerate against this backdrop, reaching 3.7% Y/Y in January (consensus of 3.9%) from 5.0% in December, "with the sharp drop driven by the phasing out of the VAT increase from 25% to 27% in Jan 2012, and utility bill cuts this year". "We think that the easing cycle will continue, but not at the pace of one cut per month", the analyst concluded.