- ADP employment report: US losses 169,000 private sector jobs
- BGA German exporters group sees EUR/USD averaging 1.50 next year, exports growing 10%
- Goldman releases top trades for 2010; Global growth to reach 4%, Fed on hold next two years
- Nikkei: Japan to add JPY 20 trln stimulus package
- Fed’s Lacker: Fed will not allow deficits to be inflated away; real rates are too low
- Beige Book: US economy slowly recovering; employment weak
- US equities close flat after failing to surmount 50% Fibo in S&P; 10-yr note yields rise to 3.31%
- Gold reaches fresh highs at $1216.75; oil falls $1.75 to $76.63
EUR/USD struggled to rally today despite gold moving to fresh all-time highs and ultimately slipped back within the range after the US equity market fell short of overcoming the 50% retracement of its drop from 1575 to 666 today at 1120. US highs were limited to 1.5095 while dips were limited to 1.5032. Trading was light for most of the day.
GBP continues to outperform amid reports of large M&A demand for the pound. The Barclays/Blackrock deal got prominent mention after closing today. That deal was worth $15.2 bln. EUR/GBP continues soft as well. Goldman likes GBP/NZD as one of its top trades for 2010.
USD/JPY was capped at 87.40 for much of the session but managed to retest resistance at 87.50 late in the session. Stops are seen in the 87.55 region and technically a close above that level would be significant.Firmer US bond yields helped.
AUD/USD and CAD eased as most aspects of the reflation trade stalled today except for gold whicg continues to act like a runaway train. We close at 0.9250 and 1.0510.
