EU Morning Report - BoJ easing speculation hurts Yen

The euro (EUR) is weakening against most of its major counterparts, giving back its gains following the Spanish regional election results. Spain’s Prime Minister party retained power in Galicia and this victory translates to power that will help him push through additional austerity measures. Since no discussion was made on the Spanish bailout plan during the past EU summit, there is an apparent conformity among the European leaders that Spain’s domestic issues should take precedence for now. EU Economic and Monetary Affairs Commissioner Rehn shared his confident view that the Troika will give the green light for Greece’s next tranche of financial aid. Market participants are expected to monitor closely the Canadian economic data releases today, especially the Bank of Canada (BoC) lending rate decision.

§ The Japanese yen (JPY) appears across the board, as easing expectations from the Bank of Japan (BoJ) are rising. The euro (EUR) produced a 5-month high at 104.59 versus the Japanese yen (JPY), while the US dollar (USD) recorded a 3-month high at 80.00 yen.

§ OIL dropped to 88.55 a barrel, after it had risen as high as 91.25.

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