- Swiss government sees GDP growth of +0.7% in 2010, +2.0% in 2011. Inflation +0.8% in 2010, +0.7% in 2011
- Shanghai share index down 0.8%
- French November EU harmonised CPI +0.2% m/m, +0.5% y/y, as expected
- UK November CPI +0.3% m/m, +1.9% y/y, slightly firmer than median forecast +0.2%, +1.8% respectively
- UK October house prices fell 2.2% y/y – DCLG
- ZEW institute December German economic sentiment index 50.4 vs 51.1 in November, pretty much in line with median forecast 50.0
- Greek FinMin: Implementing fiscal measures will convince markets of effort to cut deficit. They represent “very significant” policy departure
- Austrian central bank says there is no “watchlist” of Austrian banks
- Moody’s: Outlook for the Irish banking system remains negative
- EU Commision: Greece 2010 budget and Papandreou’s statement are steps in the right direction. Commission looks forward to Greece spelling out in January concrete steps for 2010/2011 fiscal tightening
The USD has seen across the board gains in hectic trade this morning. The greenback is garnering general support from the recent run of strong U.S. economic data, which is prompting markets to bring forward their timeframe for Fed monetary tightening.
Meanwhile the euro is being weighed down in it’s own right by worries surrounding the fiscal health of countries like Greece and Spain and by worries surrounding the health of European banks in general and Austrian banks in particular.
EUR/USD started around 1.4640 and for a long-time it looked as though we weren’t going anywhere. Finally we slipped lower, a major New York bank seen selling aggressively. When ACB buy interest didn’t materialise around 1.4600 as expected, stops just below said level and 1.4680 were triggered in quick succession.
We got to 1.4553 before steadying initially, talk of 1.4550 barrier option interest and BIS buying around 1.4555 lending support. However the relief was temporary and further stops were triggered on move through 1.4540. We posted a session low of 1.4527 in the wake of disappointing German ZEW data (see above) before marginal recovery, presently at 1.4535.
There is talk of a 1.45/1.5300 dnt, expiry end of year, being in play.
Cable is down at 1.6235 from an early 1.6290. Cable was supported for quite awhile by decent selling of the EUR/GBP cross. But eventually decent buy interest at 1.6240/50 was taken out and stops just below triggered sending us down to session low 1.6222 before slight recovery.
EUR/GBP is down at .8960 from an early .8985, having reached a session low of .8936 at one stage.
USD/JPY is trading firmer, presently up at 89.40 from an early 88.95. Japanese exporter sell orders up at 89.40/50 have so far capped the topside.
AUD/USD is down at .9070 from an early .9130, the sell-off here accelerating when stops just below .9100 were triggered. Talk of buy orders down at .9050/60 has so far lent some tenuous support, a session low .9061 posted.
