- Greek PM and central bank chief insist no aid will be needed
- Measures to be announced later today to curb CDS speculation
- Japan’s January account balance much better than expected at JPY 900 billion
- JPY continues to weaken despite more good economic data, but this might be explained by the latest FX speculative positioning data
- Regional equity markets gain close to 2% on average
- Gold remains steady at $1135/oz, oil close to $82/bbl
The EUR crosses opened higher in interbank trade and have been able to maintain these gains throughout the session with little or no pullback. EUR/USD closed in NY at 1.3615 and opened at 1.3630 with EUR/JPY also opening 30 pips higher. The reason for this was the bullish interview given by the Greek PM after his meeting with Sarkozy. He said aid was probably a non-issue and he was backed up on this by his central bank chief. He also said that Germany, France and Greece would take measures against speculation in credit default swaps and that the EU would back these and he hoped the US would also. This has encouraged EUR shorts to continue to cover. Ranges: EUR/USD 1.3627/91, EUR/JPY 123.22/79.
USD/JPY tried again to break above the reported offers at 90.65/70 but was unable to do so. Further positive Japanese economic data was again ignored. Talk of heavy stops above 90.75 now. Range: 90.35/68.
Cable was relatively quiet, dragged higher by short covering but lagging the EUR somewhat. Range: 1.5128/86.
AUD was relatively quiet but nonetheless well bid after a strong technical close above the 100-day MA. Range: .9079/.9116.
Markets: Nikkei +1.8%, HK +2.1%, Kospi +1.4%. Gold and oil steady.
