- Japan Airlines closes down 44.8% on growing expectations of bankruptcy
- China C.Bank says it is raising bank’s reserve requirement ratio by 0.5%, effective January 18
- EU trade commissioner-designate De Gucht: Valuation of yuan is major problem, should be revalued
- Kuwait oil minister: Expects no change in OPEC oil supply at March meeting. Says oil price “fantastic”
- Shanghai share index up 1.9%
- Cadbury unanimously rejects Kraft’s wholly inadequate offer
- Bank of France industry business sentiment index 101 in December, up from 99 in November and better than median forecast of 99
- Japan FinMin Kan: Will express further government support for JAL if needed
- EU’s trade commissioner-designate De Gucht says supports Russia WTO entry
- UK November global goods trade balance -£6.784 bln, better than median forecast of -£7.0 bln
Probably the main feature of the mornings volatile, messy, trade has been across the board improvement in the yen. USD/JPY is down at 91.70 from an early 92.20, while EUR/JPY is down at 132.82 from an early 133.55.
The yen is benefitting from repatriation flows related to European bond redemptions today and general concerns over JAL which looks to be headed toward bankruptcy. General risk appetite is also on the wane, not helped by China’s move to raise bank’s reserve requirement ratio by 0.5%, and this has helped underpin the yen as well.
EUR/USD has had a busy enough morning, but at 1.4485 presently is effectively unchanged on the day. Buy orders at 1.4450/60 and sell orders at 1.4520/30 have contained price action. A US custodial was a notable seller above 1.4500, while the BIS was a notable buyer below 1.4500.
Cable has made gains, presently up at 1.6145, but it’s been very choppy progress. Cable started around 1.6085 and was lifted early over 1.6100 with Asian sovereign buying noted. However the pairing soon ran into trouble and slumped back below 1.6100 but once again ACB buying was reported in the 1.6070/75 area lending solid support.
The release of better than expected UK trade data at 09:30 GMT (see above) then lifted cable back above 1.6100 before talk of UK clearer buy interest lined up for the 11:00 GMT sent the pairing soaring to a session high 1.6164. Cable was already slipping from the high into the fix and hasn’t managed to reclaim it since.
USD/JPY as aforementioned is down at 91.70 from early 92.20, but so far touted buy orders at 91.50/70 have held the line.
AUD/USD is down on the day, presently at .9235 from early .9280. Hedge funds have been notable sellers today. The sell-off accelerated to a session low .9207 in the wake of the China reserve requirement news, before steadying.
