April 29th, 2010 12:17:41 GMT

Order central: Thursday

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  • USD/JPY sell orders 94.30/50
  • USD/JPY buy stops 94.75 and 95.10
  • 1.3200 vanilla expiry at 14:00 GMT in EUR/USD
  • AUD/USD stop loss buy orders at 93.10
  • SNB buy orders in EUR/CHF at 1.4325
  • Cable stops at 1.5275 just triggered

3 Comments

April 29th, 2010 12:15:57 GMT

Update: Trichet:Greek Gov Must Take Courageous Budget Action

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–Adds detail on Stab Pact to story that first ran at 11:32 GMT

MUNICH, Germany (MNI) – The Greek government must embark on
courageous, recognizable and specific actions that will lastingly and
credibly consolidate its public budget, European Central Bank President
Jean-Claude Trichet said Thursday.

Loans are not transfers, and indeed, they come at a cost, the
president stressed in prepared remarks for an economic summit at
Munich’s Ifo Institute.

They also come with strict conditionality, which must assure
lenders that the loans will not only be repaid, but also that the
borrower will be able to stand on its “own two feet over a multi-year
horizon,” the ECB president said.

“In the case of Greece, this will require courageous, recognizable
and specific actions by the Greek government that will lastingly and
credibly consolidate the public budget,” he explained.

Trichet, who met Wednesday with German lawmakers, said his main
message to them was that a “fast parliamentary procedure [to approve
Germany's portion of EMU aid to Greece] was highly recommended in the
present circumstances.”

Trichet said flatly, “I will not comment on the negotiations that
are currently taking place in Athens.”

But, he said, “they have to be concluded by a courageous,
comprehensive and convincing multi-year program and I am confident as
regards the results of these discussions between the Greek government,
the European Commission, the ECB and the International Monetary Fund.”

“What we need at this time is a strong sense of direction. We need
a sense of direction that can guide us on how we can emerge from these
turbulent events and how we can return to the path of economic
stability,” Trichet said.

In the president’s view, this sense of direction can come from
steps including a “strong and credible program negotiated between the
Commission, the ECB, IMF, and the Greek government.”

Looking back at the history of Economic and Monetary Union, Trichet
said that the M (monetary) part of the construction has done well over
the life of the single currency area, keeping an average inflation rate
at around 1.95%.

However, “the main current challenges for our union originate in
the ‘E’. Economic union is based on responsible national policies:
fiscal policies, wage policies, structural policies.”

The crisis has revealed “weaknesses in the peer surveillance
process and in the implementation of the Stability and Growth Pact. Thus
another major lesson of the crisis is the need to strengthen the
institutional framework of the economic union.”

Trichet urged Germany to help with a “leap forward in policy
surveillance and policy adjustment.” Still, “fiscal adjustment alone
will not be sufficient to ensure sustainability,” he said. “Structural
reforms that will lead to more balanced growth are also vital to rebuild
the resilience of our economies.”

“The result must therefore be a renewal of the Stability and Growth
Pact and the incorporation of a framework of surveillance for national
policies of competition,” Trichet said.

“I hope that considerable energy will be devoted to this area in
this country [Germany], so that a central outcome of the present
demanding episode will be to strengthen the foundations of our monetary
union,” he pleaded.

The Stability and Growth Pact must spot and correct deviant
behaviors “at an early stage,” he said.

“Europe has reacted with speed, energy and determination in the
financial crisis. We have to stay on this path. We continue to need wise
and sound, rapid and determined action by all countries,” he urged.

Trichet also underlined that the “primary objective of euro area
monetary policy will remain the maintenance of price stability.”

–Frankfurt bureau; +49-173-694-7935; tbuell@marketnews.com

[TOPICS: MT$$$$,M$$FX$,M$$EC$,M$X$$$,M$$CR$,MGX$$$]

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April 29th, 2010 11:53:33 GMT

AUD/USD: Runs into Layered Offers above 0.9280

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Dealers in London say sell orders in AUD/USD are heavy above 0.9280 and stretch all the way to 0.9320. Dealers say many are option related with strikes clustered around 0.9300. Some stops are noted however above 0.9320. AUD/USD has dealt up to 0.9288; last at 0.9282.

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April 29th, 2010 11:45:31 GMT

EUR/USD: Strengthen on Tough Reduce Deficit by 10% of GDP Comment

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We have just been flooded  by a host of comments over Reuters firstly German President and ex-IMF Chief Koehler saying it was in Germany’s interest to stabilise the EZ by contributing to a Greek rescue package. Nothing new here of course but there has been renewed urgency in German comments over the last 24-hours perhaps highlighting the gravity of the Greek situation. 

 Trichet comments were equallyunexiting. What got the market going was a comment that the EU/IMF want Greece to cut the deficit by 10% of GDP in 2010/2011 with Reuters quoting sources. This is a tough ask of course but the market liked the news and EUR/USD traded back into the 1.3270s.

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April 29th, 2010 11:45:09 GMT

ECB Trichet:Greek Gov Must Embark On Courageous Budget Action

by

MUNICH, Germany (MNI) – The Greek government must embark on
courageous, recognizable, and specific actions that will lastingly and
credibly consolidate its public budget, European Central Bank President
Jean-Claude Trichet said Thursday.

Loans are not transfers, and indeed, they come at a cost, the
president stressed in prepared remarks for an economic summit at
Munich’s Ifo Institute.

They also come with strict conditionality, which must assure
lenders that the loans will not only be repaid, but also that the
borrower will be able to stand on its “own two feet over a multi-year
horizon,” the ECB president said.

“In the case of Greece, this will require courageous recognizable
and specific actions by the Greek government that will lastingly and
credibly consolidate the public budget,” he explained.

Trichet, who met Wednesday with German lawmakers, said his main
message to them was that a “fast parliamentary procedure [to approve
Germany's portion of EMU aid to Greece] was highly recommended in the
present circumstances.”

Trichet said flatly, “I will not comment on the negotiations that
are currently taking place in Athens.”

But, he said, “they have to be concluded by a courageous,
comprehensive and convincing multi-year program and I am confident as
regards the results of these discussions between the Greek government,
the European Commission, the ECB and the International Monetary Fund.”

More

–Frankfurt bureau; +49-1736947935; tbuell@marketnews.com

[TOPICS: MT$$$$,M$$FX$,M$$EC$,M$X$$$,M$$CR$,MGX$$$]

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April 29th, 2010 11:35:40 GMT

Germany Lawmaker: Shld Talk With Banks About Greece Haircuts

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BERLIN (MNI) – A senior member of German Chancellor Angela Merkel’s
CDU/CSU-FDP government coalition said Thursday that there should be
discussions with Greece’s creditors about a voluntary haircut on their
claims.

“We should talk with banks and other investors about voluntarily
foregoing their claims” against Greece, Leo Dautzenberg, the CDU/CSU’s
parliamentary financial policy speaker, said here.

He also demanded that Eurozone members draw up instruments
describing how to involve investors in the future in aid measures for
fiscally ailing states.

Nobert Barthle, the CDU/CSU’s parliamentary budget speaker, said on
Wednesday there was significant resistance inside the CDU/CSU
parliamentary group against aid for Greece without participation of the
creditors.

–Berlin bureau: +49-30-22 62 05 80; email: twidder@marketnews.com

[TOPICS: MT$$$$,M$$FX$,M$X$$$,M$$CR$,MGX$$$,M$G$$$,MFX$$$,MFGBU$]

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April 29th, 2010 11:26:12 GMT

Update: EU Rehn: Greece Aid Talks To Conclude In Next Days

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–Adds full quotes and more detail

BRUSSELS (MNI) – The European Commission is confident that talks on
a multi-year programme for Greece will be concluded in the next few
days, European Commissioner for Economic and Monetary Affairs Olli Rehn
said on Thursday.

Details of an aid package for debt-stricken Greece, including the
terms of the lending and the conditions, are being hashed out in Athens
by delegations from the European Central Bank, the IMF and the European
Commission.

“I am confident that the talks will be concluded in the next days,”
Rehn said. “The outcome will be a multi-annual programme,” he said. He
added that funding to Greece would be conditional on the implementation
of fiscal consolidation and structural adjustments.

“I cannot provide you with the details today as we are about to
conclude the talks, but I can assure you that when we meet next time I
will give you all the details,” he said.

He said the deal would “give Greece sufficient breathing space from
the financial markets.”

“I want to underline that this exercise is not only because of
Greece but for every euro area member state and their citizens,” he
said, adding that maintaining the stability of the euro “is absolutely
crucial for our economic recovery and for steady growth.”

Greece’s Eurozone partners and the International Monetary Fund have
offered the debt-stricken country a lifeline of loans worth E45 billion
this year and more in subsequent years.

“I have been in daily contact with and, just spoke again, with our
mission chief in Athens whose team has been working day and night to
complete their job there,” Rehn said. “In the past 10 days the experts
of the commission, the ECB and the IMF have worked extremely
effectively and hard with the Greek government.”

–Brussels: 0032 487 (0) 32 803 665, echarlton@marketnews.com

[TOPICS: MT$$$$,M$$FX$,M$$EC$,M$X$$$,M$$CR$,MGX$$$]

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April 29th, 2010 11:16:23 GMT

US Stock Futures Up Smalls before the Open

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Continuing on from solid if unspectacular gains on European bourses, US futures markets are showing modest gains in pre-open trading. S&P 500 +0.5%, Dow +0.3% and Nasdaq+0.4. Weekly jobless claims should be the main data focus in NY with market looking for a consensus 11k decline in initial claims. On the earnings front we see ExxonMobil, Procter and Gamble, Motorola and Conoco Phillips

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April 29th, 2010 11:15:31 GMT

EU Rehn: Confident Greece Work Will Conclude In Next Few Days

by

BRUSSELS (MNI) – The European Commission is confident that talks on
a multi-year programme for Greece will be concluded in the next few
days, European Commissioner for Economic and Monetary Affairs Olli Rehn
said on Thursday.

Details of an aid package for debt-stricken Greece, including the
terms of the lending and the conditions, are being hashed out in Athens
by delegations from the European Central Bank, the IMF and the European
Commission.

Rehn said he was in daily contact with the delegation, which was
working “day and night.”

He said he couldn’t give details of the plan today, but that the
programme would be a “multi-annual” plan, which would give Greece
“breathing space” from the financial markets.

Greece’s Eurozone partners and the International Monetary Fund have
offered the debt-stricken country a lifeline of loans worth E45 billion
this year and more in subsequent years.

–Brussels: 0032 487 (0) 32 803 665, echarlton@marketnews.com

[TOPICS: MT$$$$,M$$FX$,M$$EC$,M$X$$$,M$$CR$,MGX$$$]

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