The euro went up in value in the last few hours of Asian forex trading. Today (Friday) is the first day of the new quarter, with the forex markets reflecting a series of manufacturing data from around the world and anticipating even more data later in the day. Will euro’s strength hold? I don’t think so. “With the Greek vote behind us, and Quantitative Easing 2 officially over, all eyes will be on the [US] economy again,” forex analysts at BNP Paribas said as quoted by MarketWatch. So, go dollar, go!

The EUR/USD forex pair is changing hands at 1.4517 at the moment of writing this post.

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The US dollar mostly weakened earlier during European trading, however as the GDP q/q data release is approaching (in about a half hour, at 12:30pm GMT) the US dollar is growing stronger with EUR/USD reaching a low of 1.2777, indicating that forex traders are back in the quest to safe-haven currencies (US dollar, yen).

“Better European growth news doesn’t alter the fact that the drivers of the euro’s recovery against the dollar are all pretty much played out,” wrote strategists at Societe Generale, cited by MarketWatch. “The sovereign credit crisis faded, European short-term rates rose, U.S. bond yields made a huge downward adjustment, and as we can see, European growth dramatically outperformed the U.S.”

Second-quarter GDP growth for the US economy, the world’s largest economy, is seen likely to be revised lower today in about 30 minutes after data on international trade for June released earlier this week showed an uptick in imports and a sharply wider deficit between exports and imports.

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The dollar gave up much of its earlier gains yesterdar after the Federal Reserve expressed more concerns about the outlook for the U.S. economy. However during Asian trading it regained its strength against the euro and is currently trading at around 1.3110.

“On the economic front, they sounded much more downbeat,” said Aroop Chatterjee, a forex strategist at Barclays Capital, cited by MarketWatch. “That’s a change from the rhetoric we’ve been hearing from Fed speakers and past FOMC statements.”

Still, the potential for the dollar to fall much further is limited, Chatterjee said. “In the event the economic outlook worsens, there will be knock-on effects to global growth,” blunting gains by the euro or other major currencies.

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It’s NFP day, and I should have known better and gotten out of the positions earlier but anyway… one learns. NFP is at -131,000 while the anticipated value was -63K. Not very nice for the US economy, and apparently for the US dollar which is taking quite a beating as I am writing this. I still haven’t closed my EUR/USD position…

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