- US retail sales ex-autos and gas +0.7% vs +0.5% exp
- April Empire Fed 6.56 vs 18.0 exp
- US Feb business inventories +0.6%, as expected
- Spain plotting to strip deficit-running regions of power
- Italy delays publishing estimates on 2012 public finances
- ECB bought no bonds for 5th consecutive week
- Fitch not considering Italian downgrade
- Fed’s Pianalto sees momentum in US recovery
- FT: International investors shunning Europe
- Argentina nationalizes YPF, Spain miffed
- JPY leads, commodity bloc lags
- S&P 500 declines 0.04% to 1370
The euro outpaced any improvements in risk trades. EUR/USD began to move up after retail sales but was capped by offers at 1.3050. As Spanish yields fell back below 6% the euro continued to rise. Demand at the London fixing led to a rally to 1.3073 but it wasn’t until after Europe closed that the euro surged to 1.3148. Repatriation and buying from a US investment bank were the rumored causes.
Cable similarly strong to 1.5900 from 1.5830.
An early swoon in market sentiment knocked down Treasury yields and hurt USD/JPY, touching as low as 80.29. Afterwards, the dollar was unable to recapture its mojo, moving essentially sideways toward 80.45 at days end.
Large suspected flows in EUR/CAD kept the Canadian dollar on the defensive as USD/CAD touched 1.0032 at the highs before drifting back to parity.
