- US existing home sales rise 9.4% in September, best rate in 2 years
- Canadian budget deficit rises to C$ 23.7 bln from April through August
- Canada’s Harper says no risk of debt/deficit/interest rate spiral
- Canadian FinMin Flaherty: Stimulus temporary, will return to surplus in medium-term; no tax hikes
- ECB’s Constancio: Eurozone recovery very weak; Euro not the object of ECB policy; strong EUR helps control inflation; dollar will remain reserve currency for many years
- EU plans to begin cutting deficits by 2011
- S&P 500 falls 1.2%
The dollar gained ground across the board in uninspired trade on Friday. The surprising drop in UK GDP, profit-taking in equities and commodities and an article in the FT suggesting the Fed may shift its rhetoric before long to allow the market to prepare for higher rates at some point down the road all helped support the dollar today.
Central banks were steady buyers of EUR/USD and GBP/USD on dips however. Large amounts of EUR/USD were bought at he tail end of the US session as prices dipped to 1.4987.
USD/JPY was firm throughout the session, rallying as high as 92.12. Exporter offers are seen at 92.20/25 but stop loss buy orders are mixed around similar levels.US 10-year note yields ended at their highs for the week, at 3.49%, a supportive factor for the rate-sensitive USD/JPY. US real-money accounts were consistent dollar buyers for a third session today, perhaps a sign that money is moving out of Japan as the fiscal picture their deteriorates.
Commodity currencies were modestly on the defensive Friday as risk aversion ticked up Friday afternoon. AUD dipped to 0.9200 and USD/CAD rose toward 1.0530 late in the day.
Have a great weekend one and all. Root on the Patriots, UK readers!
