- EU ministers begin talks today aimed at expanding EFSF
- Still unclear whether Germany will completely support any expanded bail-out facility
- ECB always concerned with inflation- Trichet
- EU sees an increase in Sovereign debt tensions as unavoidable: Der Spiegel
- Japan to be important supporter of EFSF- Tamaki
- Australian inflation gauge +0.2% MoM, +3.8% YoY
- UK house prices on the increase: Rightmove
- Shanghai stockmarket falls 2.25%, reacting to RRR increase on Friday
- Gold steady at $1363/oz after 1% fall on Friday
European Sovereign debt issues and Chinese inflation were the two main talking points in Asia today ensuring that the EUR and the AUD lost some ground.
EUR/USD opened around 1.3370 and had a whippy start to the interbank trade, up and down inside a 60 pip range between 1.3340 and 1.3400. The Trichet comments in the Bild am Sonntag regarding inflation did give a lift at one stage but overall the bears have had control as more uncertainty seems certain to persist for the next few months on Sovereign debt issues. Ranges: EUR/USD 1.3329/1.3390 (high of 1.3404 in early interbank), EUR/CHF 1.2861/97
AUD/USD has also had a bearish tone for much of the day, all of it related to China. The 50bps rise in the RRR had an effect on the Chinese stockmarket and with other inflation-controlling measures also deemed likely, the AUD has been heavy for much of the session. Ranges: .9869/.9916
USD/JPY has had another quiet range with EUR/JPY enjoying the little bit of volatility that was present. Ranges: USD/JPY 82.81/83.00, EUR/JPY 110.53/94
Cable has traded 1.5843/82 and EUR/GBP .8412/36
