- Japan’s jobless rate rises to 4.5%
- Japan’s retail sales stronger than expected at +1.9% YoY
- Australian government lowers growth forecast for 2012 to 3.25%
- French newspapers report that S&P will lower French rating to ‘negative’ in next 10 days
- Regional bourses rally by around 1% on average
- Gold $1710/oz; Oil $97.70/bbl
Any movements and flows of note have been in the JPY crosses, with EUR/JPY taking centre stage again after a long break.
The initial tendency in Asia was to buy the JPY crosses, with AUD/JPY inching higher early, before the Australian government GDP reassessment sent AUD/USD plunging 50 pips quite quickly. The French newspaper reports of an S&P French downgrade also momentarily stalled the risk-on trade, but both these setbacks were easily forgotten and the JPY crosses will end the session on their highs.
AUD/USD opened near .9910, fell sharply to .9860 on the GDP forecast, but has since put in an impressive 80 pip rally. Range: .9859/.9944
USD/JPY managed to marginally outdo its overnight highs but solid offers at 78.30 repelled advances. Ranges: 77.93/78.29
EUR/USD has performed very well despite the reports on a French downgrade. Reports overnight that EUR short positioning is getting to extreme levels might be encouraging short-covering. Ranges: 1.3284/1.3354
Cable 1.5466/1.5515; USD/CHF .9201/43