Forex trading headlines from the US session:
- Canadian CPI +1.2% m/m vs +0.7% exp
- US pending home sales +5.0% y/y vs +8.7% exp
- Cyprus to implement capital controls Thursday, re-open banks
- Fed’s Rosengren says QE benefits outweight costs
- Fed’s Pianalto: QE tapering “could emerge before long”
- Fed’s Kocherlakota says Fed should clarify conditions that stop and/or slow QE
- Fed’s Evans says pace of asset purchases likely to continue through year end
- Italian centre-right official says Bersani has closed door on coalition
- S&P 500 down 0.1% to 1563
- JPY leads, EUR lags
Not much movement today in the euro as EUR/USD ends the day right where it began at 1.2776. The low of the day 1.2751 but solid bids ahead of 1.2750 held the market.
Similarly, USD/JPY ran into good buying support just ahead of 94.00 and has rebounded to 94.43. A swoon in risk appetite marked the lows but stock rebounded nicely late in Europe and through the US close.
Flows related to month-end were a main driver ahead of the long weekend beginning Friday.
USD/CAD ran up close to 1.0200 ahead of the Canadian inflation data but dropped back to 1.0150 afterwards. The move came slightly before the data and StasCan is investigating whether the data leaked early.
Gold was strong in US trading, jumping to $1604 from $1592 as capital controls in Cyprus stoked fears.
