- Although light on detail, the German and French leaders commit to establishing a common plan to recapitalise European banks before the end of October
- UK PM warns that EZ leaders must take decisive steps
- Belgium to buy Dexia’s Belgian operations for EUR4 billion
- Australian job ads fall by 2.1% MoM
- Regional stockmarkets gain 0.5% on average but HK falls by 1% (Nikkei closed)
- Gold +1% to $1653/oz, Silver +2%; Oil $83.50/bbl
The early interbank market tried to take the EUR/USD lower, but strong technical support near 1.3340 and just below did its job. The early Asian market spent most of its time around the NY closing level of 1.3385 but once bids started to build up near 1.3350, the initial direction was established. The good NFP number and the Franco-German statement all helped improve risk sentiment and encourage short-covering in the EUR. Ranges: 1.3345 was the interbank low and the range otherwise was 1.3376/1.3466.
AUD/USD followed the risk sentiment leads from the EUR, falling firstly to session lows near .9750 before recovering on solid demand from an Australian bank (corporate demand we believe). Real money offers above .9850 are capping for now. Ranges: .9750/.9845
USD/JPY was again comatosed in a 17 pip range, cable traded 1.5526/1.5615 and USD/CHF saw .9223/71.
