- S&P affirms UK’s AAA rating with a negative outlook; calls budget assumptions optimistic; debt approaching levels inconsistent with AAA
- ECB bond purchases reach a total of EUR 60 bln; pace of purchase slow to just EUR 1 bln in latest week; 1 week tender tomorrow to drain that liquidity
- Bernanke: Credit remains tight for small business
- Greek deficit falls 46% from year ago levels in first half of 2010
- Fed’s Lacker: Further policy easing a very long way away; market overreaction to recent soft data
- BOE’s Posen: Concerned UK recovery could falter
- US sells $35 bln 3-year notes at 1.055%; bid to cover 3.2
- ESFS ready to launch almost immediately when approved
- Alcoa earnings beat estimates; boost S&P futures; Cash market closes flat at 1079
- US Treasuries edge higher 10-year note yield up to 3.05%.
One of the duller session in months today but that should not be a surprise for a summer Monday. EUR/USD was confined to about a 40 pip range in NY, ending toward the highs of the day. Offers extend from 1.2600 to 1.2610 but small stops lie above the latter level.
USD/JPY was range-bound in NY as well. It eased to 88.40 during the US morning on modest risk aversion but ends off its lows at 88.56. Traders see buy orders in the 88.25/30 area and offers from Japanese exporters at 89.25.
Cable rallied toward resistance at 1.5080, edging up to 1.5085 before slipping lower on news that S&P is concerned about rising debt in the UK being inconsistent with a triple A rating. It slumped to 1.4995 on the report before rebounding, It ends at 1.5030.
Commodity currency traded in narrow ranges in during the US session. USD/CAD traded 1.0360/90 amid slightly weaker commodities. AUD traded 0.8725/55 amid modest concern about a Chinese slowdown.