ForexLive US wrap-up: Risk appetite improves

• S&P 500 holds below 1150 resistance once again
• US wholesale inventories fall 0.3%; weaker than expected
• UK NIESR says growth in the 3 months to February slowed to +0.3%
• Greece’s Papandreou: EU may intervene to lower Greek borrowing costs
• Merkel: EMF a good idea as last resort; supports G20 talk on imbalances
• Trichet slightly more receptive to EMF idea than German colleagues
• US sells $21 bln 10-yr notes at 3.735%; bid-to-cover 3.45: Very strong demand
• US February deficit $221 bln;17th straight monthly deficit
• RBNZ holds OCR steady at 2.5%; hints at mid-year hike
• S&P 500 rises to 1146, up 0.5%
• US 2-year not yields rise 4 bp to 0.91%; 10-yr note rises 5 bp to 3.72%
• Gold falls on rumored central bank sales

EUR/USD rallied strongly late in London, reaching the 1.3680 area. Waning Greek concerns, trimming of stale short positions and slightly improved risk appetites helped underpin EUR/USD, EUR/JPY and AUD/USD today. The failure of the benchmark S&P average to overcome the 1150 technical hurdle helped trim risk sentiment during quiet afternoon trade.

USD/JPY ramped higher on very strong buying from a US money center bank during the NY morning. A high of 90.83 was seen. Exporter offers were absorbed above 90.50 but more toward 91.00 helped cool the rally. Similar offers at 124.00 slowed the cross.

Cable recouped much of the ground lost in London but was unable to retake the 1.5000 level. Heavy cable sales from a UK clearing bank was seen again today; the same name that bought the 1.44 puts earlier in the week. A buy recommendation from a US bank’s tech analysts made the rounds this morning. They see a rally to 1.57 with a stop below 1.4775.

AUD/USD extended its rally to 0.9193 this morning and spent the rest of the session retrenching. Traders are quiet long of this pair, sources say.