- Russian central bank: Dollar to remain main reserve currency for some time
- OECD’s Gurria: Dollar will have its ups and downs, but will continue as reserve currency
- Japan senior MOF official: Doesn’t expect G20 to discuss dollar as key currency
- German Fin Min Steinbrueck: Euro would be threatened if Stability and Growth Pact not taken seriously
- UK Q-4 final GDP unexpectedly revised lower, to -1.6% q/q from -1.5% and to -2.0% from -1.9%
It started out oh so calmly this morning, then a run of official comments lit the fuse and all hell broke lose with the dollar seeing across the board gains (usd/jpy a notable exception.)
Comments from the Russian central bank, Japanese MOF official, and to a lesser extent an OECD official gave reassurance the dollars’ reserve currency status isn’t in any danger.
But the really big comment came from German Finance Minister Steinbruek who opined that the euro would be threatened if the Stability and Growth Pact (SGP) wasn’t taken seriously.
The SGP is an agreement by EU member states related to their conduct of fiscal policy (i.e. to avoid excessive deficits), to facilitate and maintain Economic and Monetary Union of the European Union.
The pounds’ cause wasn’t helped any by the unexpected downward revision to Q-4 GDP.
USD/JPY remained relatively quiet. Ongoing reports of year-end JPY demand helped curtail dollar gains there.
