- Eurogroup, not EU summit needed to OK Greek package: Germany concedes
- BOC Q1 business survey upbeat
- Canadian FinMin Flaherty not concerned by CAD strength, justified by economic fundamentals
- S&P 500 rises 0.2% to 1196, 18-month high; Dow closes back above 11,000
- US 10-yr note yields falls 7.5 bp to 3.845%
- Gold closes at session lows of $1155; oil falls 0.65 to $84.27.
EUR/USD was in consolidation mode for much of the US session. We spent most of the day below the 1.3600 level with to brief upside probes faltering in the 1.36-teens. Dips were limited to the 1.3565/70 area leaving last evening’s gap to the topside unfilled. The market is quite balanced from a sentiment standpoint with the bulls and bears each evenly matched, though the bears are more vocal. A great deal of skepticism greeted the incremental steps toward a Greek bailout with the market growing frustrated that the EU has yet to put the gun on the table, load it, and fire it. The gun is out, the ammo has been secured, but no shots have been fired…
USD/JPY traded with a heavy tone during the US session but dips were shallow. We found buyers several times in the 93.15 area. More bids are seen toward 92.80/90 on weakness, traders report. JPY crosses were soft as well as EUR/JPY , AUD/JPY and GBP/JPY all closed near their lows.
GBP/USD bulls were very disappointed by today’s price action. While the greenback was lower across the board, a short-covering rally in EUR/GBP helped weigh on cable. Odds are we will close almost exactly unchanged from Friday (1.5375) after a rally toward 1.5500 overnight.
AUD/USD was hit by profit-taking in London and New York. Profit-taking ahead of 0.9400 and covering of EUR/AUD shorts also weighted in the wonder currency. We end the day at 0.9280.
