Currency Updates:
U.S. Dollar Trading (USD) continued to be battered on Thursday as the fallout from the FOMC to extend stimulus continued to weigh heavy on the dollar. Share markets rally ensured that risk was on in FX markets, hindering the USD to trade at record lows against the Aussie Dollar and XAU in late session trading. The Dow Jones rose by 1.96%, S& P 500 up by 1.7% to trade at its highest level in 2 years, and the NASDAQ also higher by 1.46%. In Domestic news, Weekly Jobless claims rose by 20K jobs to 457K, yet did little to hinder investor optimism. Keeping with the theme of Jobs data, focus now shifts to NFP on Friday with forecasts of +60K jobs for the month of October. Pending Home Sales will accompany the NFP release, whilst Fed chairman Bernanke is scheduled to speak late on in the day.
The Euro (EUR) did well to take full advantage of a bruised greenback, trading at 9 month highs despite perceptions that the decision by the FOMC to add stimulus may undermine the Eurozone recovery. The ECB held interest rates at 1.00% as widely expected, with members highlighting the risk on inflationary pressures if interest rates remained low for a sustained period. The EURUSD traded with a low of 1.4100 a high of 1.4281 before closing the day at 1.4208.
The Japanese Yen (JPY) underperformed against a broadly weaker dollar over uncertainty of the outcome of the BoJ meeting on Friday. Heavy demand on the EURJPY throughout European session ensured the JPY was unable to take advantage of the dollar weakness. The USDJPY traded with a low of 80.56 a high of 81.21 before closing the day at 80.74
The Sterling (GBP) saw the BoE keep interest rates on hold at 0.5%, and no change to its asset purchase program as widely expected. Ultimately this was cause for the British Pound to take full advantage of a weaker dollar. The GBPUSD traded with a low of 1.6083 and a high of 1.6299 before closing the day at 1.6266.
The Australian Dollar (AUD) surged to fresh post float highs despite benign retail figures for September. The Aussie Dollar traded at fresh 28 year high as boost in investor sentiment ensured the high yielding currency was in heavy demand. Overall the AUDUSD traded with a low of 1.0022 a high of 1.0175 before closing the day at 1.0160
Oil & Gold (XAU) XAU traded at a fresh all time high of US$1393.20 whilst Oil also moved higher to US$%86.49 and the weak USD.
