• Iran says will not stop uranium enrichment, even if it receives nuclear fuel from abroad
  • Shanghai share index ends up provisional 2.1%, one-month closing high
  • Dollar’s status as main reserve currency could be eroded by economic woes, but other currencies remain far from being able to challenge its dominance – China’s top official newspaper
  • Iran’s guards chief says US, UK intelligence linked to sunni rebel group, warns of retaliatory measures
  • China’s GDP to grow 9% in Q-3: Experts (data due Thursday)
  • German FinMin spokeswoman says not aware of any plans for summit on currencies (me neither)

Dollar a little mixed today.

EUR/USD has traded higher this morning, presently up at 1.4930 having started out in Europe down around 1.4875. There had been early worries surrounding the meeting of euro zone finance ministers in Luxembourg today, with euro strength seemingly on the agenda.

These worries however disappated as European stocks and gold headed higher. An Asian sovereign was seen as a notable buyer, reserve diversification seemingly still alive and well.

Talk of buy orders now down at 1.4900/10, sell orders still up at 1.4970 up through to 1.5000 barrier interest.

Cable having opened lower around 1.6325 soon came under renewed pressure. Stops in the 1.6275/80 area were triggered as sterling came under accelerated across the board pressure taking us to a session low 1.6242. Comments made by MPC member Posen in a weekend interview, raising the spectre of further QE next month, certainly didn’t help. Neither did the Ernst and Young Item Club touting pound being stuck at near parity to euro for up to 4 years.

Cable has managed to recover as the USD has come under accelerated pressure, presently back up at 1.6290. EUR/GBP meanwhile is up at .9165 from an early .9110.

USD/JPY started around 90.85 before coming under selling pressure, triggering stops just below 90.50 and reaching session low 90.38. Talk started to circulate that a large Swiss bank had come out recommending a long possie in USD/JPY and that helped spur a recovery. We’re presently back up at 90.90.

The bank has an inital target of 92.50 on way to 95.00, with stop set at 87.80.

AUD/USD has made ground, presently up at .9215 from an early .9175. Here, ongoing talk of 50 bps rate hike next month and strong commodity prices continue to underpin.