- China’s CPI +5.5% YoY, higher than the 5.4% forecast but still lower than the 5.8% which had been feared
- China’s PPI +6.8%, industrial output +13.3%, and retail sales +16.9%
- BOJ leaves call rate unchanged, announces new credit line for growth industries
- Japanese big manufacturing business sentiment falls heavily
- Australian business conditions index worsens
- UK RICS house price balance -28 from -21
- EU FinMins to hold emergency meeting later today
- Fed’s Fisher (hawk) says will not support any more monetary easing and policy must be reversed or risk inflation
- Nikkei rallies after BOJ, now +1%
- Gold $1521/oz, Oil $97.25/bbl
EUR/USD closed in NY around 1.4420 and will close in Asia near the same level after a down-and-up session. The first move was down, driven by EUR/JPY and EUR/CHF selling but the failure of EUR/CHF to challenge the 1.2000 barrier (1.2008) encouraged some short covering. Reports that EU FinMins were to have an emergency meeting also unnerved EUR longs. Regional equity markets spent the majority of the morning session in the red but as they started to bounce, so also did the risk trades like EUR/JPY. Ranges: EUR/USD 1.4376/1.4442, EUR/JPY 115.24/89, EUR/CHF 1.2008/80
AUD/USD traded with a heavy tone through the morning with moderate risk-aversion in the EUR setting the tone as well as some rumours of a Chinese CPI number of 5.8% or even 6.0%. Once again the market was caught short by a better-than-feared number and the AUD/USD rallied sharply before topping out ahead of 1.0650. Ranges: 1.0564/1.0647
USD/JPY got its lead from the crosses, falling early on EUR/JPY selling but making back those losses as cross-JPY covered shorts after the BOJ. Ranges: 80.08/33
Cable 1.6354/1.6417, EUR/GBP .8782/.8809, USD/CHF .8345/77
