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Corrective pullback off Monday's........>

EURO-DOLLAR
MNI (London)
EURO-DOLLAR: Corrective pullback off Monday's recovery high of $1.1215 extended
to $1.1125 Wednesday before it closed above $1.1130. Move down was influenced by
risk aversion, markets reacting to suggestions that China could use its rare
earths (used in the technology industries) in the current trade spat with the
US. Risk aversion was also given a lift by UST 10y yields touching a 20-month
low, the S&P a 12-week low. EU confirmed it has sent a budget warning letter to
Italy's FinMin. Markets await reaction Thursday. The late partial recovery in
EUR/USD extended in Asia to $1.1143 before easing, struggled to gain a foothold
back above $1.1140 ahead of Europe. 
- Support now seen at $1.1130/25 ahead of the YTD low of $1.1107(May23) with
support expected to emerge through to $1.1100. Resistance $1.1150/55, $1.1170,
stronger between $1.1200-20. 
- Spain inflation data at 0700GMT provides domestic interest ahead of US Core
PCE, Personal Consumption, GDP and Initial Jobless Claims at 1230GMT. Pending
Home Sales follow at 1400GMT.
MNI London Bureau | +44 203-586-2231 | john.webb@marketnews.com
MNI London Bureau | +44 203-586-2231 | john.webb@marketnews.com

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