- USD/JPY jumps 65 pips in moments, no comment from officials
- Troika teleconference with Greece said to be positive, talks to continue
- Japan Aug. trade deficit at ¥775.3B versus ¥218.8B expected
- Japanese exports climb 2.8% y/y while imports surge 19.2%
- UK consumer confidence at 48 in Aug versus 49 in July
- IMF says China needs to boost domestic consumption
- China should not buy European debt, says former central bank advisor
- Australian leading index shows annualized growth of 3.1% in Aug, July revised higher
- IMF lowers Australian 2011 growth forecast to 1.8% from 3.0%
- AUD and EUR early leaders, CAD and NZD lag; moves small
- Nikkei flat, Shanghai composite up 2.2%, S&P futures up 3 points
The market was bogged down in pre-FOMC trading until USD/JPY fell to the lowest since Aug 18 and then promptly reversed and surged 65 pips to 76.75. Comments from the Japanese government suggest it was not intervention. The cause was either a rate check from the BOJ or buying from a big non-Japanese bank designed to imitate intervention, depending on who you ask.
The euro got a boost after the headlines from the Troika teleconference squashed reports indicating no meetings would take place until early October. Since Japan came online EUR/USD has been trapped between 1.3700 and 1.3720.
Commodity currencies were weak early in the session but are getting a late lift. AUD/USD fell as low as 1.0232 but has bounced back to 1.0285 and is leading the market. CAD and NZD are now playing catch-up.
