• Spot gold trades to $1374 intraday, closes at $1373; AUD closes at post-float high of 0.9905
  • ECB’s Nowotny: Keep bond buying program as a safety belt; avoid unilateral, political steps that could spark global crisis (US China currency bill)
  • Finnish PM does not see euro “staying high”: Reuters
  • BOE’s Sentance repeats rates should rise soon or will have to be raised sharply later; says weak pound would be good for UK manufacturers
  • S&P 500 breaks 1173 resistance, closes up 0.7% at 1178
  • US 10 year note yields reach 2.49% intraday, closes at 2.42%

AUD/USD was the star of the show today, rising sharply along with commodity prices and breaking to a new high at 0.9936, the highest level since the AUD was floated in 1983. We closed the session at 0.9905. Traders note on-going talk of barriers at 0.9950 and 1.00. Of note today was a very large AUD/CHF buy order which helped send the AUD from around the 0.9870 level toward 0.9925.

EUR/USD’s price action was relatively muted today with the single currency unable to keep pace with the commodity-driven pairs like AUD/USD, USD/CAD, NZD/USD and USD/ZAR. We did shoot higher to the 1.3990 level briefly as the market absorbed the large AUD/CHF order but spent the bulk of the session range-trading close to 1.3960.

The one surprise today was that a continued equity market rally and a new record in gold could not prompt a retest of even the 1.4000 level during the NY session. Mid East sellers capped the market around that level in London, we’re told.

All the anecdotes we heard today in USD/JPY were of real-money buyers. We managed one rally toward 82.00 near midday but we soon slumped back to 81.75 where we end the day.

EUR/GBP was extremely volatile today, jumping to fresh trend highs at 0.8839 before turning tale and slumping to 0.8778 late in the day. EUR/GBP has tracked EUR/USD higher of late so the late turn around to the downside may be a sending us a signal of what is to come in EUR/USD. Cable ends the day near 1.5900, supported by the slide in EUR/GBP.

USD/CAD eased as low as 1.0007 today before bouncing to close at 1.0036. Protection of 1.00 barriers helped keep the greenback above par against its northern neighbor.