Who would have expected the forex market to be the island of stability amid the crazy old world in which we live. We’re more focused on the AIG nonsense, as distasteful as it is, than on getting the bank mess cleaned up once and for all and the economy moving again.
Markets are calmly range -trading this morning with familiar ranges holding sway. 1.3065/70 continues to cap rallies near-term while buyers are eyed at 1.2980 on dips.
USD/JPY buyers are at 99.30 with sellers at 98.90/00.
Next up data-wise we have CPI and current account data from the US. inflation is seen ticking up 0.3% in February while the core is expected to rise at 0.1%. The current account gap is expected to shrink to $137.0 bln in Q4 from $174 bln the prior quarter. That gap will shrink even more rapidly in Q1 of 2009.
Later, we get the AIG ritual sacrifice before Congress at 10 am Washington time followed by the FOMC statement at 2:15 this afternoon. That will be scoured for signs of more-rapid asset purchases.
