The Euro rebounded from a two-year low as Finance Ministers from the Euro-zone gathered to discuss the debt crisis. The 17-nation currency rallied versus the Yen after the European Central Bank’s President, Mario Draghi, suggested bank officials may be inclined to reduce the interest rate again should the need arise. The shared currency climbed despite data indicating Investor Confidence dipped the most since July, 2009.
Currency trading news revealed that the U.S. Dollar and the Yen rose early in the day following economic releases showing Japan’s Machine Orders plummeted and China’s inflation fell. According to government figures, China’s Consumer Price Inflation advanced at the slowest pace since the start of 2010. Both announcements prompted higher demand for refuge as investors grew concerned over the outlook for global growth.
Later in the day, the U.S. Dollar traded mixed while investors remained cautious ahead of the upcoming meeting of key European Finance Ministers in Brussels.
Risk aversion in the Forex trade markets caused the Canadian Dollar to decline to the lowest price in over one week against its American counterpart. The Loonie slipped in tandem with the Australian and New Zealand Dollars, while the Yen and the Swiss Franc gained on guarded optimism that the upcoming meeting between E.U. Finance Ministers would yield positive results. Skepticism among money market investors prompted Spanish and Italian bonds to fall.
The South Pacific currencies extended losses versus the Yen after official reports from China and Japan confirmed the world’s biggest economies have slowed down.