Currency Updates:
U.S. Dollar Trading (USD) Quiet but nervous markets yesterday as focus on China tightening and Eurozone bailouts kept traders on the sidelines. US data was weaker than expected with Oct Housing Starts falling -11.7% m/m. October CPI jumped 0.2% m/m whilst Core CPI was flat. In US stocks, DJIA -15 points closing at 11007, S& P +0 points closing at 1178 and NASDAQ +6 points closing at 2476. Looking ahead, Weekly Jobless Claims are forecast at 44k vs. 435k previously.
The Euro (EUR) stabilized after heavy selling over the past few days reclaiming the 1.3500 handle as the IMF heads to Ireland to check whether the country needs to activate bailout funds. The threat of contagion spreading the bailout need to Portugal is also being closely watched. EUR/USD traded with a low of 1.3460 and a high of 1.3567 before closing at 1.3530. Looking ahead, September Current Account previously at -10.5bn.
The Japanese Yen (JPY) the rally ran out of steam as the USD failed to extend gains and support was tested on the downside. Y83.00 held firm the major stayed in tight range for the rest of the trading day. Overall the USDJPY traded with a low of 83.02 and a high of 83.57 before closing the day around 83.20 in the New York session.
The Sterling (GBP) managed small gains but was also very subdued rallying on slightly better than expected data. UK Claimant Count change was -3.7k vs. 5.1k forecast. BOE/MPC Minutes showed another 1-7-1 split with the Member Sentence wanting a rate hike and Posen wanting more stimulus. Overall the GBP/USD traded with a low of 1.5852 and a high of 1.5951 before closing the day at 1.5920 in the New York session. Looking ahead, October retail Sales forecast at 0.4% vs. -0.2%.
The Australian Dollar (AUD) was well supported as the market finished selling and bargain hunters came back into the market. AUD/JPY demand is helping to underpin with traders targeting Y85 as USD/JPY begins to climb. Overall the AUD/USD traded with a low of 0.9724 and a high of 0.9836 before closing the US session at 0.9820.
Oil & Gold (XAU) Gold managed a small bounce back to above the $1340 level. Overall trading with a low of USD$1330 and high of USD $1345 before ending the New York session at USD$1337 an ounce. Oil weakness continued even as US Oil inventories fell heavily for a second week. WTI Oil Closed -$1.92 at $80.42 a barrel.
