- Report on Bloomberg stated that the Obama administration sees bankruptcy likely for GM and Chrysler
- White House denies the report
- Tankan survey showed Japanese business confidence at an all-time low
- Australian manufacturing index +1.7 points and retail sales -2%.
- NZD falls on Bollard comments.
Early Asian trade saw strong buying of JPY crosses, particularly GBP/JPY, as traders foresaw a weak Tankan report. USD/JPY rallied to 99.35 as the report hit the wires but buyers were soon undermined by the Bloomberg report re GM and Chrysler. JPY crosses were hit hard as risk averse plays returned. In spite of a White House denial which saw most of the losses quickly reversed, the slide has recommenced as the afternoon progresses.
The Nikkei and Kospi both gained around 1.75%, the Hang Seng fell marginally and Shanghai was up over 1%. Gold is steady at $918/oz and Brent crude similarly so, just under $50/bbl.
Ranges: USD/JPY 98.23/99.45; EUR/USD 1.3175/1.3266; Cable 1.4280/1.4365; EUR/JPY 129.90/131.85; AUD/USD .6850/
