- Ireland, Eurogroup continue to hash out deal terms
- Austrian press reports aid cut off to Greece was discussed in cabinet meeting; FinMin denies, says will make Dec. payment if conditions met
- ECB’s Stark: To continue removing extraordinary liquidity into new year
- Fed’s dual mandate may be pared down to one
- BOE’s King: Can do more QE, if necessary. Policy can move in either direction; inflation still high but economic slack should keep expectations contained
- Fed’s Dudley: Dollar could rise as economy recovers
- Fed’s Bullard: If economy improves. Fed may not need to buy all $600 bln in bonds
- Sarkozy reiterates support for European financial transaction tax: Dow Jones
- Commodities Research Bureau index tumbles 3.2%; S&P down 1.6%
- US yields seesaw; fall from 2.96% at noon to 2.84% at close in 10s
- Awaiting Eurogroup finance ministers press conference
The combination of intensified European sovereign debt woes (Ireland just a matter of time, Portugal a layup, onto Spain!) and fears Asian central banks will slam on the monetary breaks to cool inflation combined to send the dollar soaring across the board today. The dollar index snapped a downtrend in place since June of this year and a bullish cross of the 10 and 21-day moving averages gave the market’s further confirmation that the worst for the dollar has passed.
1.3535, the 50% retracement of the 1.2587/1.4283 rally was nearly tested as prices slipped as far at 1.3546 before a very modest bounce. 1.3560 is the first technical resistance of note and trapped longs will be more than happen to lighten up at that level if given the opportunity.
