Lagarde pleased with stronger dollar

We have always wanted a strong dollar and and it has appreciated so European exporters can only be pleased, The Frecnh Finance Minsiter says.

ECB’s Nowotny says that contagion risk has to be taken seriously ad says the Greek situation is different from Spain and Portugal. EUR exchange rates are currently not a matter of concern, Nowotny says. Nowotny decries the actions of hedge funds in the crisis and says they should try and take action against it.

EUR/USD trades at 1.3750.

Lagarde: Premature to comment on Trichet’s successor

French Finance Minister Lagarde says it is premature to comment on Trichet’s successor at the ECB when his term expires next year.

No it ain’t, sweetheart. It’s what we do!

Also crossing the wires, ECB’s Nowotny says the ECB has no clear bailout clause, so it cannot intervene on Greece. He can think of ways to cooperate with Greece regarding EU structural funds.

ECB’s Liikanen: Trusts Greek government will follow-through

Finnish ECB rep Liikanen says that he trusts Greece will follow-through on its economic plans. It is very important that countries adhere to Stability Pact guidelines. ECB rates are currently appropriate, Liikanen said.

Also crossing the wires are comments from the Greek PM. He says the priority is to rescue the economy and reduce debt. Speeding up the economy is required, otherwise the costs of the crisis will be higher.

Greek rate spreads are tightening, down to 313 bp from over 400 bp last week. This is helping give the EUR a boost.

French auditor: Cut debt or risk downgrade

Reuters is running a headline which says French auditor says France must cut debt, deficit levels, or risk a ratings downgrade.

EUR/USD has eased a bit from from session highs of 1.3774. It trades now at 1.3753.

1.3750+ stops triggered

EUR/USD is in the midst of short-squeeze this morning as speculation of a rescue package for Greece and efforts at pension reform by the debt-laden country are announced. The pension reforms are key as they would ban early retirements and raise the retirement age.

Central banks have been selling into strength already after buying heavily on the 1.36-handle. Despite those sales, we’ve overcome the 38.2$ retracement of the drop from 1.4027 to 1.3585 at the 1.3754 level. 1.3806 is the 50% retracement of that same drop.

Look for bids on pullbacks to the 1.3715 area near-term.

North American earlybirds trip EUR/USD stops

EUR/USD has rallied strongly, presently at 1.3768 having been as high as 1.3773 as stops tripped through 50.  Talk has it US traders entered the market intent on stop hunting and managed the task quite easily.

ForexLive European Morning Wrap: Lotta noise, not a lotta change

• ECB spokesman: Trichet changing flight plans from Australia to Europe purely because of logistics. ECB President had accepted invite to Thursdays EU summit in mid-January
• German December trade surplus s.a. 16.7 bln vs 17.0 bln in November. Down but better than median forecast of 15.0 bln
• German final December CPI confirmed at -0.6% m/m, +0.8% y/y
• China January passenger car sales up over 100% y/y – Official data
• Greece considering raising average real retirement age to 63 from 61 by 2015.  Greek pension system to face funding problems by 2015 if no changes made
• UK December global goods trade balance -£7.278 bln vs -£6.798 bln in November, much worse than median forecast -£6.63 bln. Gap widest since January 2009
• EIB: Cannot take part in bailouts that involve budget deficits or balance of payments support.
• Hector Sants quits as CEO of UK Financial Services Authority (FSA)

When all said and done alot of huffing and puffing but not alot of change on the majors. 

We started the day, the market all a twitter at the news that Trichet had changed his flight plans and booked an early flight back to Europe from Australia to attend this Thursdays EU meet.  Speculation grew that a plan was going to be hatched to save Greece. Turns out the switch was purely logistical and Trichet had accepted an invite to the meeting back in mid-January.

EUR/USD started around 1.3695 and  rose early on the Trichet speculation. On the way higher Russia was a notable seller into strength (probably booking a little profit having recently been a notable buyer in the low 1.36’s.) 

Eventually we got to a session high 1.3746 where the BIS stepped in as a seller and that was the top in place. We were already slipping lower when the news that Trichet’s plane switch was purely logistical hit the wires.  EUR/USD skidded below 1.3700, but the stay there was brief and we’re back at 1.3725.

Talk has buy orders lined up at 1.3695 down through 1.3680. On the top side, conflicting talk. Some have stops through 1.3750, some through 1.3760.

Cable little lower on the morning, presently at 1.5585 from an early 1.5610. Started out well for the pairing as it rallied to session high 1.5646 where it ran into a brickwall.  Things were already turning sour when the release of particularly disappointing UK trade data increased the pressure, sending us to session low 1.5563 before some recovery.

USD/JPY has made some marginal ground, presently at 89.65 from early 89.40.  Talk of sell orders 89.90/00, stops through 90.10.  Buy orders 89.00/20, stops just below.

AUD/USD up at .8720 from early .8775.  Asian sovereign buying has helped support.

ECB spokesman: Trichet changing flight plans from Australia to Europe purely because of logistics

Accepted invitation to this week’s summit in mid-January. EUR/USD under pressure in wake of comments hitting wire, presently down at 1.3700. Kinda dampens speculation that a plan to save Greece is to be hatched at Thursdays meeting.

Earlier was hearing talk of buy orders lined up down at 1.3695 to 1.3680.

You’ll like this….but not alot

Some talk BIS has been in buying EUR/USD in recent trade. We’re presently at 1.3715.  Take it for what you will. Not fully convinced meself, but there we have it.

Sants quits as head of UK Financial Services Authority – FT

FSA has no immediate comment on report that CEO Sants has quit.

EDIT: FSA CONFIRMS SANTS TO STEP DOWN IN SUMMER OF 2010.

Cable sits at 1.5575, halfway through aforementioned 65/85 buy orders. 

EUR/GBP up on the day, presently at .8810 from early .8775.  If I remember rightly good old Barclays Capital yesterday had an .8830  target for EUR/GBP.  Not far to go now peeps.