- German December Ifo business climate index 107.2, stronger than Reuters’ median forecast of 106.1
- Ifo’s Abberger: Domestic situation in Germany is still good, sees no danger of recession at moment
- Strong Spanish auctions
- Sweden’s Riksbank cuts repo rate 25 bps to 1.75%. Economic outlook abroad has deteriorated and the Swedish economy is slowing down
- Moody’s affirms Poland A2 rating and stable outlook
- German Gfk January consumer confidence steady at 5.6, better than Reuters’ median forecast of 5.5
- Swiss November trade balance 3.001 bln, better than forecasts in 2.0-2.5 bln range. Watch exports up 16% to 2.058 bln
- French Trade Minister: 2011 trade deficit likely to be a record 70-75 bln
- Dutch December consumer confidence -37 pts, down from -32 in November
I pressed the wrong button and published my draft morning wrap, so you’re getting it early today.
Risk on; European stocks recovering from early weakness, NYM light crude up about one and a half bucks, Gold up $8 bucks from when I sat down, US treasury yields firmer, periphery/German bond yield spreads narrower, yada, yada, yada.
EUR/USD up at 1.3080 from early 1.3015. Sell orders were noted clustered at 1.3017/22 early, but these were blown out when a UK clearer bought aggressively around 1.3020. BIS stepped in and sold in the 1.3040/45 area, slowing the rally, but a combination of better than expected Ifo data and strong Spanish bill auctions helped put the euro bulls in the driving seat.
We’ve been as high as 1.3089 after buy stops tripped through 1.3055.
Cable up at 1.5630 from early 1.5525, having been as high as 1.5649. Middle Eastern sovereign buying was noted early setting the tone for the morning.
EUR/GBP down at .8365 from early .8380, having been as low as .8352. Talk of barrier option interest at .8350.
USD/JPY unchanged at 77.95.
AUD/USD up at .9995 from early .9945, underpinned by improved risk appetite.
