FOREX NEWS | CURRENCY NEWS BY FOREXLIVE

Draghi: ECB not a party to PSI but hear agreement near

• Will discuss in Eurogroup
• Has nothing to say on Greek bonds other than will not violate ECB Treaty
• Selling Greek bonds to EFSF would be monetary financing if ECB books a loss

Macro buyers still piling into the USD/JPY and EUR/JPY

USD’s been up to 77.36 and chewing through those Japanese exporter offers  on the way to 77.50, where  CTA stops are said to lie.

EUR/JPY ‘s just popped up to a day’s high of  102.81. but faces some decent resistance above at 102.89 which is the 100m day MA. There are also buy stops on a break up through 103.00

Draghi: Survey and hard data point to economic stabilization at low levels

• When asked on removal of word “substantial” to downside risks
• Experts say demand for second LTRO should be around the same as the first (EUR 490 bln)
• Haircuts of about 2/3rds on new collateral
• ECB to avoid “legal tricks”: Will not share Greek losses, Talk unfounded
  
• Will not give money to Greek program, would violate monetary financing
  
• A well-functioning financial system does not need non-standard measures, they are temporary in nature
• Euro area “as a whole” in better budget shape than US or Japan

Greek Eur300 mln gap to be filled by cuts in defense spending amongst others

According to ekathimerini.com

Draghi: I didn’t answer on Greek bonds before, I won’t answer now

Nice try, though, Sylvia. By the way, you look fetching today.

• Did not discuss changing interest rates today

Draghi: New collateral rules more risky

• Will have to be managed; over collateralized

Hard to manage the ham sandwiches being present as collateral, but what are ya gonna do…

Draghi: No comment on Greek bonds/EFSF

• Says Greek PM tells him Greek deal reached

First question! Told ya so yesterday! Can’t believe he punted completely.

US yields up as claims fall

Dollar benefiting across the board. EUR/USD at 1.3250.

USD/JPY at session highs above 77.30. Japanese exporter offers seen at 77.50.

US 10-year not at 2.035%. Watch 2.10%. A break above would be dollar positive.

We don’t need no stinkin’ QE!

Draghi: Stabilization of economic activity at low level

• Activity subdued
• Inflation to fall below 2% after staying above for several months
• Downside risks remain
• Will continue to support financial sector via LTRO
• LTRO has eased collateral availability
• Low interest rates and LTRO lending support to economy
• Stresses in financial markets have diminished

 

Canadian Dec new housing prices +0.1% (exp +0.2%) from +0.3% in Nov

Not much reaction to this as market listens to the Draghi press conference.

USD/CAD steady in the low 0.9950′s. Tech resistance seen up at the 200 day MA at 0.9971, and offers above at 0.9980/90. Bids  are down at 0.9935/40