Forex News | Currency News by Forexlive

Some news out of emerging markets is worrying the interbank market with Argentina announcing that it has extended the deadline on its debt swaps by 2 weeks. The JPY crosses are whippy but support levels in the AUD/USD and EUR/USD are holding firm, for now at least.

SEOUL (MNI) – A “brutal reassessment” of sovereign risk by the
markets has forced the Eurosystem into taking measures designed to ease
market funding activity and avoid any knock-on effects on the real
economy, Bank of France governor Christian Noyer said Tuesday

“The euro-area has been at the epicenter of this phenomenon. Some
market segments have become dysfunctional to a point that jeopardized
the transmission of monetary policy,” he told a Bank of Korea
conference here.

“The Eurosystem has therefore resorted to new steps to contain
those tensions and prevent their spillover to the real economy.”

Noyer also said that the European Central Bank has managed to
respond to the crisis of recent years without unhinging inflationary
expectations.

“At no time during the crisis have inflation expectations
significantly deviated from our definition of price stability,” he said,
noting that those expectations remain “strongly anchored” at around 2%.

“The ‘zero lower bound’ never really was a problem,” he said.

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[TOPICS: M$X$$$,M$F$$$,MFX$$$,MGX$$$,M$$CR$]

The AUD/USD is still under pressure, currently below .8400, and there was talk this morning of decent bids around .8370ish.

The Nikkei has continued to slide, now down 0.5%, and the AUD/JPY is bearing the brunt currently at 76.55.

JPY crosses under pressure in early Asia as the news of the ECB report and the Chinese property market seeps through. EUR/JPY is down at 111.60, I see fairly strong support around the 110.80/90 level. Intraday support in the AUD/JPY is at 76.30.

This is down from 55.7 in April

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