Currency Updates:
U.S. Dollar Trading (USD) the market sold the dollar once again going into Europe but the selling is getting overdone and the market was unable to sustain the new direction. There was little data so the market reacted to FED speakers who showed disunity in regards to QE2 and this supported the Dollar. In US stocks, DJIA -22 points closing at 10835, S& P -3 points closing at 1144 and NASDAQ -3 points closing at 2376.
The Euro (EUR) fresh year highs above 1.3600 were seen as the Euro rally continued. Widespread Strikes in Europe did little to halt the March with sellers struggling to absorb the Dollar selling. EUR/USD traded with a low of 1.3565 and a high of 1.3648 before closing at 1.3600. Looking ahead, September German Unemployment is forecast at 7.6% with a change of -20k. September Inflation forecast at 1.8% vs. 1.6% y/y.
The Japanese Yen (JPY) quiet trading but with a downside bias continued with Y83.50 tested in Europe before stabilizing and remaining in a tight range for the rest of the day. EUR/JPY is holding firm above Y113 with the market waiting for fresh news. Q3 Tankan Survey 8 vs. 7 forecast. Overall the USDJPY traded with a low of 83.48 and a high of 84.11 before closing the day around 83.65 in the New York session. Update August Retail Sales at 1.4% vs. 4.4% y/y.
The Sterling (GBP) had a quiet day holding within a rare 100 pip range. EUR/GBP took advantage to break above 0.8600 and is threatening the long term downtrend. August Mortgage approvals dropped to 49k vs. 47k previously. Overall the GBP/USD traded with a low of 1.5760 and a high of 1.5877 before closing the day at 1.5800 in the New York session. Looking ahead, September Nationwide House Prices forecast at -0.3% vs. -0.9% previously.
The Australian Dollar (AUD) tested above 0.9700 and was very well supported on the differing central bank outlooks. Commodities rallied and the mood is very bullish for the Aussie but the rally has been sharp and overbought levels can lead to a pullback if mood changes. Overall the AUD/USD traded with a low of 0.9662 and a high of 0.9732 before closing the US session at 0.9695. Update August Building Permits fell -4.7% m/m.
Oil & Gold (XAU) consolidated above the $1300 level in a quiet range. Overall trading with a low of USD$1305 and high of USD $1313 before ending the New York session at USD$1310 an ounce. Oil gained 2% as US inventories showed a drop. WTI Oil Closed +$1.68 at $77.85 a barrel.
