Currency Updates:
U.S. Dollar Trading (USD) a quiet start to the week overnight with most of Europe and America away on Bank Holidays. The positive Greece poll news allowed a risk on rally in Asia but this was quickly reversed as the European Debt crisis rolled on this time through Spain. Looking ahead, March House Prices forecast at 0.0% vs. -0.8% previously m/m. Also May Consumer Confidence forecast at 70 vs. 69.2 previously.
The Euro (EUR) the Spanish bond yields increased to 6.5% the highest since last November overnight as the risk of default increased as Spanish bank bailouts from Spanish government linked their fate together. The EUR/USD rally above 1.2600 was reversed quickly on news of the banking bailout request.
The Japanese Yen (JPY) the USD/JPY was under heavy pressure in Asia yesterday breaking below Y79.50 support but the selling was contained below and we finished back above the range support. Crosses are struggling to hold rallies with the EUR/JPY back below Y100 and the AUD/JPY looking towards Y80.
The Sterling (GBP) the GBP/USD was mixed opening up strong and testing above 1.5700 but the risk off environment in thin trade later in the US was enough to drag it back towards 1.5680. Looking ahead, May German Core CPI forecast at -0.1% vs. 0.2% previously. Also May UK CBI distributive Trades forecast at -7 vs. -6 previously.
Australian Dollar (AUD) the AUD/USD opened up very strong gaining nearly 1% above 0.9800 and hitting 0.9880 before easing back to the figure by the start of Asia on Monday. The outlook in the short term is on whether the EU can calm markets and stocks can rally. UPDATE April Retail Sales at 5.8% vs. 10.3% previously.
Oil & Gold (XAU) Gold rallied above $1580 before falling back to opening levels at $1570 where trading was closed for the US session.OIL/USD managed a small rally back above $91 but is subdued.
