• Fed’s Plosser: Fed just as concerned about deflation as inflation. US has turned corner on economy, in a recovery. As economy strengthens, will have to look very hard at reversing courses on rates. Falling US commercial real estate threat to small, medium-sized banks
  • Japan FinMin Fujii: Japan economy starting to recover but remains unstable
  • Swiss trade balance 2463 mln swiss francs in October
  • Fed’s Fisher: Falling dollar not necessarily inflationary. There are “trade offs” between low rates and strong dollar. Unemployment too high, will take long time to come down. Concerned real growth will fall short of 3% in 2010 – MSNI
  • UK October PSNB £11.419 bln, worse than median £7.0 bln, highest October on record
  • UK October retail sales +0.4% m/m, +3.4% y/y, vs median forecasts +0.5%, +2.9% respectively
  • German govt economic advisor Bofinger sees risk of double-dip recession late 2010, early 2011
  • BOE’s Fisher: QE could stop or carry on at Feb MPC meeting
  • OECD sees 2009 GDP growth in OECD area at -3.5%, +1.9% in 2010, +2.5% in 2011

Risk appetite is a little wobbly today, European stocks lower (FTSE off 0.5%, DAX 0.75%), while oil has given up around three quarters of a buck. Gold is also trading softer. Currency beneficiaries have been JPY and USD.

EUR/USD having stood around 1.4910 is down at 1.4855 presently. An ACB stepped in early and sold just above 1.4900. Stops were tripped on move through 1.4900 and we’ve been as low as 1.4844 before steadying. Talk of Eastern European name (think it was Russia) buying at 1.4945/50 lending much-needed support.

USD/CHF trading firmer, up at 1.0190 from early 1.0130. USD gains seem to have started in USD/CHF. A large Swiss bank is said to have bought aggressively around 1.0130 and was quickly joined by a German bank adding to the upside momentum. We’ve been as high as 1.0195 so far. Talk now of sell orders up at 1.0200/10, with stops just above there.

Cable down at 1.6620 from early 1.6695. We rallied initially back above 1.6700, but the stay there wasn’t over long. We stood around 1.6675 on the release of a plethora of data at 09:30 GMT, which included public finance, retail sales numbers. There was nothing there to write home about, the public finances being a fair bit worse than expected. Despite this cable fleetingly peeped over 1.6700 before retreating, and reports circulated that an ACB had stepped in and bought.

Finally however cable came under heavy selling pressure, stops tripped on move through 1.6635 to a session low 16618. So far reported buy orders at 1.6600/20 have managed to hold the line.

USD/JPY lower, with the JPY seeing good across the board gains against the backdrop of wobbly risk sentiment. USD/JPY is down at 88.80 from early 89.15. Talk of buy orders down at 88.70/80, stops just below there.

AUD/USD has come under increasing pressure, down at .9170 from early .9230.