The Asian market was very quiet and the ranges tight, Euro’s moved into the London session just above the 1.3260 level and looking vulnerable however, German IFO numbers came in better than expected helping to stave off any move down through 1.3200, even so it was only comments from Bernanke that turned the market fully, one would surmise that the US is happy with a weak USD specifically against the Euro, after months of upbeat news from the US he leads us to believe that QE is on the cards again he didn’t directly say it but the implication was there, personally I doubt it but who knows. Euro’s from this point was bid for the remainder of the day trading steadily upwards to above 1.3350 for a tidy gain and upsetting many an analyst in the process. GBPUSD tagged along with the Euro’s with nothing in the way of data or scandal (apart from private dinner parties I never seem to be invited too), left the GBP following along slowly moving from a low just above 1.5800 struggling to 1.5950 for a 1% movement on the day, nice if you got it right. EURGBP stayed pretty much in line only slightly higher on the day as Bernanke’s comments turned everyone USD negative. AUD well since I told my boss that it was dead in the water and with contracting business sentiment and figures in China AUD has done nothing but go upwards, while I can agree that China is a large market for the Ozzies, Japan is larger and I’d be more concerned on that front if there wasn’t so much rebuilding going on, but the risk takers have seen fit to buy over the last 3 days of trading so who am I to argue heavy GBPAUD buying was seen during the session the only reason Oz didn’t push to the 1.0600 level. Having traded steadily lower over the Asian session, it took impetus from the –USD comments and moved firmly back above 1.0500. USDJPY the only exception to the rule of the day as carry trade buyers appeared again to buy EURJPY and AUDJPY, whether they are purely carry trades remains to be seen but a lot of retail, and importer buyers were seen in the market during early Asia, the move was continued into London with only small pull backs on –USD comments with a solid 50tic range on the day almost seems worth day trading. Comments by Schneider-Ammann Min of Economy in Switzerland to increase the cap on EURCHF did move the market a few tics but we are getting used to these fanciful ideas.
Yesterday’s premiership results
Actual Consensus Previous Revised
NZD Trade Balance (NZD) Feb
161M 153M -199M -159M
EUR German IFO – Business Climate Mar
109.8 109.6 109.6 109.7
EUR German IFO – Current Assessment Mar
117.4 117 117.5 117.4
EUR German IFO – Expectations Mar
102.7 102.6 102.3 102.4
USD Pending Home Sales M/M Feb
-0.50% 1.00% 2.00%
Topside : 83.00-83.30 (light buy stops) 83.50-83.80 (medium buy stops) 84.00-84.30 (light offers)
Downside : 82.30-82.60 (light sell stops) 82.00-82.30 (medium bids) 81.60-81.90 (decent bids) 81.00-81.40 (medium bids)
Topside : 1.3360-1.3380(light offers) 1.3380 (med buy stops) 1.3420 (med offers) 1.3430-1.3470 (light buy stops) 1.3500-1.3530 (light buy stops)
Downside : 1.3280-1.3310 (light sell stops) 1.3220-1.3250 (light bids)
Topside : 111.50-112.00 (light offers) 112.20-112.50 (medium buy stops)
Downside : 109.70-110.00 (light bids) AUDUSD
Topside : 1.0540-1.0570 (light buy stops) 1.0590-1.0620 (light offers)
Downside : 1.0450-1.0480 (light bids) 1.0400-1.0430 (medium sell stops)
JPY Corporate Service Price Y/Y Feb -0.60% consensus -0.40% previous -0.20% revision -0.40%
CNY: China Hu: Large Yuan Rise Wouldn’t Solve US Economic Problems – Xinhua
CNY: PBOC fixes yuan mid-point at record 6.2840/dollar
CNY: China Jan-Feb industrial profits down 5.2% from year ago
CNY: China Raises 2012 Long-Term Foreign Debt Quotas For Foreign Banks – Sources
KRW: North Korea gives details of “weather” satellite launch
KRW: North Korea Military Elects New Leader As Party Delegate
JPY/KRW: Tanaka Tells SDF To Prepare For N. Korea Rocket’s Possible Fall On Japan -Kyodo
JPY/KRW: Japan PM: N Korea rocket launch will break UN pacts
JPY/CNY/KRW: PM Noda: Hope To Collaborate With China On Discouraging N Korea Missile Launch
JPY: Azumi: Hopes Ruling Party Stance on Proposed Consumption Tax Hike To Be Decided Tuesday
JPY: Japan Econ Min Furukawa: Govt Will Use Every Possible Tool To End Deflation
AUD: Australia CB: A$ value consistent with terms of trade
AUD: Reserve Bank Of Australia’s Corbett Upbeat China, Neutral Australia
GBP: UK in talks to sell part of RBS stake to Abu Dhabi -BBC
NZD: NZ filled jobs slip in January – official data
Another quiet session in Asia, Fitch announced Australian mortgage arrears rise unexpectedly, which when added to Stockland Group announcement (property developer) downgrade citing the impact of banks raising rates independently of RBA it doesn’t seem like a surprise to anyone. AUD slowly declined from this point moving down from the closing rate towards the 1.0500 level, Euro’s stayed in a pretty tight range peaking above 1.3365 but then dragged lower by the AUD into the mid 40’s. GBP stayed in a 15 tic range 55/70 for the most part. USDJPY briefly attempted to break higher through 83.00 but ran into exporter offers dropping back into the 80’s where it continued to trade for 4hrs. Talk of a down channel from 29 August in the targets for tech traders a break above would seem to indicate another leg up to above 1.3400 however, fundamentals would suggest otherwise for the time being.
06:00 EUR German Import Price Index M/M Feb
06:00 CHF UBS Consumption Indicator Feb
07:00 EUR German GfK Sentiment Apr
10:00 GBP CBI Rep
13:00 USD S&P/Case-Shiller Composite-20 Y/Y Jan
14:00 USD Consumer Confidence Mar
Ranges as of 6am London time
Bid Offer High Low
USD/JPY 82.862 82.872 83.04 82.8
EUR/USD 1.33503 1.33512 1.3366 1.33435
EUR/JPY 110.623 110.644 110.93 110.554
AUD/USD 1.05180 1.05200 1.0536 1.0504
NZD/USD 0.82200 0.82220 0.8236 0.8215
USD/CAD 0.99100 0.99130 0.9922 0.9911
EUR/CHF 1.20620 1.20624 1.20671 1.2058
USD/CHF 0.90343 0.90352 0.904 0.9027
GBP/USD 1.59620 1.59640 1.5972 1.5957
EUR/GBP 0.83630 0.83645 0.8371 0.8362
USD/SGD 1.25780 1.25810 1.2597 1.2568
EUR/SEK 8.89600 8.89940 8.911 8.896
EUR/NOK 7.58000 7.58500 7.5854 7.5787
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