- Hurricane Irene by-passed NY and markets should return to normal on Monday
- Market focuses on IMF’s Lagarde comment that European banks need urgent capitalisation
- She also warns that world economy is facing new, dangerous phase
- Trichet: No liquidity problems in Europe
- Japan’s EconMin Yosano: No new tools to deal with high Yen
- Regional stockmarkets +1.5% on average
- Gold $1820/oz, down from a NY close of $1827/oz
A modest improvement in risk appetite has seen the AUD and NZD make modest gains but overall it’s been a quiet session yet again.
EUR/USD closed in NY at 1.4490 and tried to consolidate above 1.4500 in early interbank trade but was rebuffed by solid selling interest near 1.4520. The high in the morning was 1.4514 and the EUR gradually drifted lower as the market focused on remarks regarding European banks made by Christine Lagarde. EUR/USD closes the session unchanged but the EUR has lost a bit of ground against the other majors, with the exception of EUR/CHF which is slightly higher on risk appetite. Range: 1.4464/1.4514
AUD/CHF has been the main mover today, with improvement in risk appetite and SNB actions convincing shorts to cover and bulls to reemerge. AUD/USD spent the early part of the day in tight ranges near 1.0580 but then triggered stops above 1.0610 in afternoon trade. Ranges: 1.0558/1.0628
The JPY refused to fall despite the increased risk appetite, with dealers following the NY lead and concentrating on the CHF. Some talk that China is the main buyer near 76.50. Ranges: 76.63/81
USD/CHF .8067/.8111; EUR/CHF 1.1688/1.1746; Cable 1.6325/75; EUR/GBP .8843/78
