- US weekly jobless claims fall 38,000 to 383,000, lowest since before Lehman collapse
- ECB’s Wellink: Clear upside inflation risks
- Bundesbank’s Weber will not attend summit with French officials on Friday
- Merkel to press Weber to leave; set to meet Friday
- US wholesale inventories rose 1% in
- Fed Governor Kevin Warsh resigns; had opposed QE2
- US January budget deficit widens to record for a January of $49.8 bln
- California January revenues rise 8.1% above target
- Egypt’s Mubarak transfers powers to VP but will stay on through September
- US 10-year note yields rise 3 bp to 3.71%
- S&P 500 ends flat; reverses 0.75% intraday decline
- Oil rises 0.7% as Egypt bursts back into the headlines
The dollar rallied across the board this morning. Central banks booked some profits on longs in EUR/USD and AUD/USD, Cable was sold after the MPC stood pat and USD/JPY rallied strongly, underpinned by firm US yields.
EUR/USD fell as low as 1.3577 before rebounding above intraday resistance in the low 1.3620s. News that Kevin Warsh, the last remaining hawkish Governor on the Federal Reserve Board, is set to resign by the end of March sent EUR/USD to 1.3640, where it stalled.
We slipped back below 1.3600 late in the session and close right around that level.
USD/JPY absorbed considerable selling from Japanese accounts in the 83.00 and 83.20 region. We peaked at 83.37 and close in the 83.25 area.
GBP/USD slipped as the dollar advanced after strong US data but found support ahead of 1.600 and bounced extremely strongly. It jumped from the 1.6015 area to a high of 1.6139.
Heavy GBP/JPY buying was noted as prices streaked higher while EUR/GBP slumped. Talk of GBP repatriation BY a UK corporate for dividend payments was rumored this morning. We end the day at 1.6095.
The Swiss franc was not used as a safe-haven from Egypt today. In fact, quite the opposite. The franc weakened versus the dollar and Euro. Traders took this as a sign that a sea-change may be afoot with the weak franc a precursor to a stronger dollar. USD/CHF broke resistance at 96.90 and traded as high as 0.9703. we close at 0.9695.
The US dollar index made its presence felt in a greater-than usual way on Thursday. Traders focused on key technical resistance at 78.35 and stops perched just above that level. We reached 78.34 before backing off… We end the day at 78.22.