FOREX: Monday results.[E]

On Monday on European trades the EUR against the dollar gained to year high on speculations European Central Bank president Jean-Claude Trichet will say on continue of increasing rate policy in Europe, but Fed can make a pause. Remind that the dollar started to decrease on June 2 after an output of Employment Report in the USA, that shown the weakest Payrolls since October of the last year.
The Institute for Supply Management's index ISM reflecting dynamics of business activity on service sector of the Great Britain, has decreased in May. The only one report has shown, that an index of managers on purchases (PMI), reflecting business activity dynamics in sector of services of the Great Britain, in May has decreased. However this drop was smaller, than predicted. Besides the most part of components of an index have shown growth.
USD remained almost the same after the 13 months minimum drop against EUR. The dollar was pressured on speculations ECB this week will hike itт??s key rate on 50 b.p.
May ISM services index wasnt surprising so that market didnт??t react.
However in the eve the dollar partially compensated decrease after FED head report. The head of the Central Bank highlighted the intention on policy of long-term price stability which remains the main target and FED is going to take all necessary measures
Meanwhile Trichet foreshadowed further ECB vigilance for EUR growth and said nothing on possible results of the future meeting.

EUR/USD began trades testing a high on $1.2980. Offers have stopped growth of a rate, but significant recoil has not followed. The euro was stabilized in a narrow range $1.2940/60. Then it started to decrease, therefore has reached support on $1.2900 and closed a trading day.
GBP/USD in the beginning of day has reached resistance on $1.8880, however couldnт??t break it. Later the rate was stabilized in a range $1.8830/70. Then decrease has proceeded, therefore the sterling has reached support on $1.8720. Recoil has not followed and session closed in the given area.
USD/JPY remained within the limits of Y111.55/75. Then the rate has raised in area Y112.20 in which closed session.

There is no doubt among experts that on June, 8th ECB will raise the rate at least on 25 b.p, making it 2.75 %.
"The market is so assured, that ECB will raise itт??s borrowing costs on 50 b.p., that the smaller figures will inevitably cause disappointment, " speaks Boris Schlossberg the main currency strategist New York Forex Capital Markets LLC.
Remind, what expectations of difference of interest rates reduction between the USA and the Europe became a principal cause of EUR growth again USD in a years advance on 9%.