- Eurogroup’s Juncker: Ireland can avoid using bailout funds if meets deficit goals; EUR/USD not at proper level; QE2 decision not a good one
- ECB bought EUR 711 bln in bonds last week; total EUR 64 bln
- Gold breaks $1400; reaches $1410 on negative international reaction to QE, World Bank comments
- Fitch downgrades four Portuguese banks
- Fed’s Bullard: QE amounts can be adjusted larger or smaller; can’t have others around the world calling the shots on Fed policy
- Fed’s Fisher: For the next eight months, we are monetizing the debt
- Greece: We’re not Ireland!
- Rehn: EU has not discussed outside fiscal help for Ireland
- S&P 500 dips 0.2%; US 10-year note up 1 bp to 2.55%
EUR/USD found repeated support on dips to the high 1.3880s as Asian central banks took advantage of profit-taking to rebalance reserve portfolios. Rebounds were shallow however and EUR/USD closes below both its 10 and 21-day moving averages. So much for a dollar collapse after QE…Offers are seen above 1.3950 and again toward the 1.3975/80 area, traders report.
EUR bulls were particularly disappointed by the inability of EUR/USD to recovery on comments from Dallas Fed chief Dick Fisher who acknowledged that the Fed will spend the next 8 month monetizing the US national debt. It was also unable to recover despite a surge to record highs in gold above the $1400 level.
USD/JPY traded in extremely narrow ranges today as focus shifts elsewhere with traders frustrated by the bucks reluctance to venture below 80.20 or above 82.00. We spent most of the US session between 81.15/20.
Cable held up well despite the heavy profit-taking in EUR/USD today; EUR/GBP was hard-hit by the shift in focus back to the peripheral European economies. Cable traded a tight 1.6120/1.6165 range in NY.
AUD/USD edged up in its range gold as it made its record run. 1.0080/1.0145 was the range in New York.
