EUR/USD
The euro dunked against the dollar on Tuesday as doubt over elections in Italy influenced data which showed a jump in the ZEW which ascended to a 34-month high in February. EUR/USD was at 1.3329 in European trade, hitting the sessions lowest, consequently consolidating at 1.3339, down 0.09 percent.
The euro temporarily hit session highs following the ZEW announcement that its index measuring German economic sentiment shot to 48.2 in February.
Experts had estimated the index to increase to 35.0 in February.
However, the euro continued to be under pressure before Italian general elections, amidst anxieties that a hung parliament could impede the chances of ramming through much needed financial reforms.
EUR/JPY
Investors are responding to divergence between Prime Minister Shinzo Abe and Finance Minister Aso over the method for the country’s fiscal policy and even who should be the Bank of Japan governor, thus making the JPY the best player amongst the G10 currency pairs. Similarly, according to South Korean representatives, while Japan was not singled out at the G20 meetings in Moscow, Japan’s plans were not sanctioned by the prestigious group.
This seems to be an indication that there seems to be plenty of dubious news assessed into the JPY considering its current levels, but markets have acknowledged that Japan will lax its financial policies bellicosely to attain its goals although its goals have repeatedly tumbled in the past.