• Swiss trade balance 2562 mln CHF in April vs 151.10 mln in March
  • FSA: Will not, as a matter of practice, be publishing details of the bank stress test results
  • Italy May business morale rises to 68.7 vs 65.5 in April, better than median forecast of 65.5
  • German May s.a jobless total rises 1,000, much better than median forecast of 64,000. Jobless total 3.456 mln or 8.2%, down from 8.3% in April, and better than median forecast of 8.4%
  • Euro zone leading economic index for April up 1.8% at 93.8 from 92.1 in March
  • German April plant, equipment orders -58% y/y- VDMA says probably sharpest decline since at least 1950, no sign of bottoming out
  • Euro zone May economic sentiment rose to 69.3 vs 67.2 in April. Slightly better than median forecast of 69.0
  • German Labour Minister: At least one Opel bidder could reach understanding with GM immediately
  • Belgian May CPI -0.07% m/m, -0.37% y/y vs 0.21%, 0.60% respectively in April. Rate turns negative for first time since December 1960
  • UK CBI retail sales balance -17 in May vs +3 in April. Worse than median forecast of -10

JPY remains weak across the board as Japanese investors (corporate, retail) accelerate process of reallocating resources to riskier, higher yielding, assets. USD/JPY is up at 96.90 from an early 96.30, while EUR/JPY is up at 134.55 from around 133.20.

EUR/USD has recovered throughout the morning, with a run of generally encouraging data (albeit not all) helping improve risk sentiment a little (see data above). Bank of Korea, China, Russia were all seen buying early between 1.3830-60 and this drove the pairing to an earlier session high of 1.3882 where Russia is said to have sold. This provided a dip, but it didn’t last long.

Bank of Korea subsequently came in buying good amounts in the 1.3860’s enabling the pairing to post a 1.3899 session high before settling back. Presently sits at 1.3880.

Cable came under fairly heavy pressure early with Asian central bank selling noted, before renewed buying resurfaced just ahead of 1.5850/55 technical support. At 1.5960 presently, cable is up some 30 points on the day