- German finance ministry: No talks on granting ESM banking license
- Bundesbank says ECB should stick to price stability
- May Canadian GDP +0.1% vs +0.2% exp
- July Chicago PMI 53.7 vs 52.5 exp
- US July consumer confidence 65.9 vs 61.5 exp
- US consumer spending flat, incomes rise 0.5% in June
- Hollande: all will be done to protect and defend euro
- US May Case-Shiller home price index -0.7% y/y vs -1.5% exp
- Ireland hikes 2012 growth forecast to 0.7% from 0.5%
- Bloomberg: Spain says has won Germany’s Schaeuble’s support for aid in bond market
- SNB reserves at 365B francs at the end of Q2 compared to 245B at the end of March
- US possibility of mortgage principle forgiveness shelved
- Congressional leaders agree to extend spending until March
- Spain 10-year yields up 14 bps to 6.75%
- Italian 10-year yields up 6 bps to 6.08%
- EUR leads, GBP lags
- S&P 500 down 0.4% to 1380
Impressive euro rally today despite murmurs out of Germany that Mario “Believe Me It Will Be Enough” Draghi will not get his way on Thursday. EUR/USD was choppy coming into the session around 1.2300 then spiking to a session-high 1.2330 before sliding back to 1.2300. Position squaring ahead of the central bank decisions and month-end were the likely culprits but you can’t ignore the Spain/Germany report.
USD/JPY too a run at 78.00 but fell 5 pips shot and is up to 78.13.
Cable was unwanted, dropping a half-cent in early US trading as the market concluded that only one thing is certain this week — that the BOE will print. Later, cable snapped back 70 pips but fell just short of 1.5700 at the options cut. Sideways around 1.5675 afterwards. I also blame this one on month-end position squaring.
USD/CAD rallied on the soft GDP numbers after a failed assault on parity and is at 1.0032. AUD/USD still stuck to 1.0500.
Oil thumped, tumbling to $87.47 from above $90. Gold slid $10 on the German comments.
