• Canada : November GDP up 0.40 %, RMPI up 4.20% and IPPI up 0.70%
  • US December Personal Income up 0.40%, Personal Spending up 0.70% and Core PCE Price Index 0.0%
  • Chicago PMI comes in at 68.8
  • Portuguese Debt Agency Chief says no reason the country won’t be able to finance itself in the market in 2011
  • Muslim Brotherhood rejects new Egyptian government; calls for continued protest
  • Canada: Flaherty says biggest risks to the Canadian economy are weak US recovery and instability of some European countries
  • Netanyahu: Israel following Egyptian scenario with concern, fears that what happened in Iran could repeat in Egypt
  • Fed’s Lockhart: Sees hopeful signs of sustained recovery in 2011
  • More Lockhart - Short term have mixed feelings about the level of savings as want to see more consumer activity
  • US Senate Energy Panel Chairman Jeff Bingaman warns Egypt protests could affect US access to affordable energy supplies
  • Egypt’s limited reserves raise fears of financial crisis
  • Europeans: We want a German central banker–FT
  • S&P 500 finished +0.75%, Gold $1330/oz and Oil was up almost 3% at $92/bbl

Occasionally we see days where the rationale for moves escape us. After Friday’s sell off as the Egyptian crisis developed, we have seen a significant reversal of risk; equities have been strong, gold has settled around $1330 and Crude has regained levels not seen since October 2008.

Strong month-end demand in the NY fix for currencies provided a further filip, seeing the dollar test the lows of the session.

EUR/USD traded up to1.3739, initially aided by month-end buying of EUR/GBP. However aggressive selling of the latter pair ultimately drove the EUR/USD back down to current levels 1.3685 and EUR/GBP to a low of 0.8332.

USD/JPY saw good semi-official support at 82.00 and dipped by a few points when a large order at the fix was executed. Similarly USD/CHF was supported most of the session around 0.9400 only to break briefly to test 0.9370.

AUD/USD also was bought to last week’s higher level at 0.9989 but failed to sustain its momentum. The AUD did not see the same amount of currency flows that the JPY and GBP enjoyed.

The surprise mover that unusually tested both sides of the market was the USD/CAD. Firstly, on strong growth and inflationary data, the pair dropped to 0.9963 only to be reversed on comments by Minister Flaherty concerned with employment and the potential of not passing the Budget package.