European session: the dollar strengthens its positions [E]

On European session closing of positions on the U.S. sales renovated as a result the dollar strengthened its positions versus the euro and the yen.

European PMI index, which based on data of interrogation 2,000 purchase managers of the companies of non-manufacturing sector of economy, in particular banks, airlines, etc., in May index has grown to 58.7, a maximum level since September, 2000.

In April index was 58.3. Nevertheless, data were predicted by the market in which focus placed the problem of rates difference in the recent time. Now investors continue to reconsider the attitude to the U.S. currency.

Remind that yesterdays performance of Chairman Ben Bernanke promoted to strengthen of dollar after Bernanke let to know that the Central Bank concerned to increase of inflationary pressure and will take all necessary measures for maintenance of price stability.

As a result speculations became more active that Fed will raise again rate at the nearest FOMC meeting that takes place on June 29.

EUR/USD in the first half of day remained in a range $1.2880/1.2930. It tested $1.2933 (50% $1.2980/1.2885) the rate to opening of American session and overcame the bottom border of a range and reached a zone of offers concentration $1.2855. Now the rate trades on $1.2870. Offers remain on $1.2950 and became stronger with approach to $1.2970/80.

GBP/USD. The message about sale of British BAA for stg10 billion to consortium headed by Spanish Ferrovial caused the growth of sterling in area $1.8770 before the pair returned to area $1.8750.

Decrease EUR/USD below a benchmark $1.2900 became the reason of activization of sales of sterling which now trades in area $1.8690. Offers are $1.8675/70, $1.8650/40 and bids are $1.8775/85, $1.8800/10.

USD/JPY tested Y112.10 returned within Y112.10/50.

Offers placed on Y112.50/60, and became stronger with approach to Y113.00

Bids marked on Y112.10/00 in area of Mondays minimal values Y111.60/50.

Today it isnt expected issue of any important news which could to affect the market sentiments which developed now.

Most likely, the trades will pass in last ranges, however it is not necessary to exclude maintenance of the tendency of dollar strengthening.