- G7 finance ministers hold conference fall on European fallout; no decisions
- US retail sales rise 0.4% in April
- US industrial production rises 0.8% in April
- European monetary source: European central banks will buy sovereign debt consistently until announce a halt: Reuters
- Fitch affirms France’s AAA rating with stable outlook after rumors of a downgrade
- Merkel: Can’t turn back on euro when euro threatened
- Lagarde denies Sarkozy threatened to leave euro: Dow Jones
- S&P 500 falls 1.9%, FTSE down 3.2%, Dax down 3.1%, CAC-40 down 4.6%
- Oil closes below $72.00, down 3.3%; gold ends 19$ below $1249 intraday high
EUR/USD fell to within 30 pips of the lows put in place in October 2008, at the depths of the credit crunch following the demise of Lehman Bros. It reached 1.2354 and ends on the lows.
EUR/USD opened on a rebound this morning in New York but the bounce was as a result of large-scale buying of upside options protection from accounts that are short EUR/USD to guard against a reversal. Talk of a G7 conference call also raised some temporary jitters. 1.2535 was the early high.
USD/JPY fell for most of the session, weighed down by unwinding of carry trades. Trades like MXN/JPY were thrown overboard as traders looked for the safety of the sidelines. USD/JPY fell as low as 91.80 before a very large bid emerged, prompting a bout of short-covering in both USD/JPY and EUR/JPY.USD/JPY ends at 92.38 and EUR/JPY at 114.15 from lows of 113.50.
GBP/USD recovered from London lows of 1.4498 at midday but found rebounds capped around the 1.4630/40 area. EUR/GBP weakness helpe give cable a slight bid amid a lousy environment for European currencies. We end at 1.4532.
AUD and CAD lost ground today, weighed down by ongoing risk aversion. There was some talk early in the session of shorts in EUR crosses versus commodity currencies being covered but those flows only slowed the declines in the commodity-linked dollars. AUD fell to 0.8852, and USD/CAD rose to 1.0379. Closing levels are 1.0328 and 0.8865.
The SNB sat on the bid at 1.4000/05 and purchased billions of EUR today. The market ends at 1.4007/08.
Have a great weekend all. Stay safe.