Forex headlines for Oct 2, 2013:
- Full recap of Draghi’s comments – EUR rises 80 pips
- September US ADP jobs report 166k vs 180k exp
- Letta wins confidence vote in Italian Parliament
- RBNZ’s Wheeler forecasts rate hikes
- France revises down jobs data after text message error
- Trichet says Europe needs very bold reforms
- Boehner, Obama and Capitol Hill leaders to meet at 2130 GMT
- Fed’s Rosengren: Fiscal conflict warranted forgoing QE taper
- No comments on mon pol from Bernanke and Bullard
- WTI oil up $1.84 to $103.88
- S&P 500 down
- JPY leads, AUD lags
EUR/USD hit a 6-month high of 1.3607 after the Italian confidence vote and Draghi speech. There wasn’t anything in the Draghi speech screaming ‘buy EUR’ but evidently there was some expectation he would move closer to another LTRO or a rate cut. It was a non-stop squeeze with stops hit above 1.3600 but there are still likely some there (or building) at the highs of the day.
USD/JPY tracked sentiment in stocks. The S&P opened much lower after the ADP data but the dip buyers were waiting and picked it up. USD/JPY touched 97.15 at the lows, rose to 97.58 in the later part of the session and then drifted down to 97.36.
The kiwi got a big boost on the comments from Wheeler. he talked about multiple rate hikes and NZD/USD jumped above 83.00 from below 0.8275.
Cable tried to take out yesterday’s high on dollar selling after ADP but it couldn’t cook up any support above 1.6250. Last at 1.6227.