- US retails sales rise 0.3% in January; weaker than forecast
- US import prices rise 1.5% in January
- US attracted $66 bln in foreign capital in December
- US business inventories rise 0.8% in December
- Italy’s Draghi: Monetary policy not a remedy for poor fiscal policy
- German CSU: No ESM bond buying, aid should last no more than three years
- US 10-year note yield dips 1.5 bp to 3.605%
- S&P 500 falls 0.3% to 1328
- CRB index falls 0.7%, oil closes at 2-month low of $84.35; copper dives 2.1%; Gold rallies to $1375
EUR/USD traded a slightly narrower range in New York than in London. We stalled just shy of the 1.3550 area where we have run into repeated resistance in recent sessions while we found support in the 1.3480 area before making one quick dip to the 1.3476 level late in the day. Central banks remain the presumed dip buyers ahead of 1.3450. The technical news of note today was a bearish cross in the 10 and 21-day moving averages. EUR/USD ends the day at 1.3488.
USD/JPY saw very heavy buying from US real money accounts but prices were unable to overcome offers ahead of 84.00. We reached 83.93 early in the day and spent most of the session range trading amid quite heavy turnover. 83.60/65 provided support on dips. 84.50 is the upside technical target while 85.00 is a rumored upper-leg of a large 80.00/85.00 double-no-touch options play.
GBP/USD was well underpinned today while EUR/GBP was heavily sold. Traders upped the odds of a UK rate hike at the next BOE meeting after reading the Governor’s letter to the Chancellor today after CPI doubled the Old Lady’s target. Cable reached 1.6170 before slipping late in the session as the dollar ranged higher. It closes at 1.6125.
EUR/GBP fell as low as 0.8357 and closes near the lows.
CHF was in demand from late in the European session. There appeared to be no particular fundamental catalyst for the move though heavy stops were triggered as USD/CHF slipped below 0.9675. Whispers of European central bank selling were heard, perhaps on behalf of their Swiss counterpart….
AUD/USD was pushed down to support at 0.9945 as commodities gave ground broadly today. Perhaps some buy the rumor/sell the news after the Chinese inflation data…The technical backdrop looks to be deteriorating and bulls are growing nervous given three stalls in the 1.0200/50 region in recent months.
Similar story for CAD. Oil fell to a two-month low, pushing the buck back up to 0.9900.
