- US non-farm payrolls fall 651,000, unemployment rate rises to 8.1% ; large downward revisions to January and December total an additonal 161,000 jobs lost. 4.4 mln jobs lost since recession began.
- Fitch puts Irish sovereign debt on watch negative one day after saying AAA was the most appropriate rating
- UK Foreign Office says GBP weakness not engineered
- Eurogroup head Junckers: Eurozone pick up not seen until late ’10; financial crisis “absolutely catastrophic”
- New York Fed president Dudley: Deleveraging process far from over
- Lloyds and UK government agree on GBP 250 bln deal to insure assets- WSJ
- US equities rally late to end essentially flat
EUR/USD was lifted ahead of the US session on rumors of a drop in payrolls of 1 mln or more. The 651k drop came almost as a relief. US equities rose early in the day and EUR/USD rallied with it. Central bank sales above 1.2740 helped limit gains. A downturn in US shares took the steam out of EUR/USD during the afternoon. EUR/GBP was underpinned by UK bank concerns helping keep EUR/USD underpinned relative to cable. New York range: 1.2600/1.2753
USD/JPY rose late in the day, boosted by a turnaround in US equities. A rise in US consumer credit sparked hopes that consumer spending would rise as well. USD/JPY offers extend from 98.50 on up to 100.00 now, dealers report. Japanese accounts out of Tokyo bought during the US morning, sparking a move into the 98.20s before prices dipped back into the 97.60s. New York range 97.66/98.37
Cable was in focus during the afternoon as Lloyds Bank was locked in negotiations with the UK government on a scheeme to protect a big chunk of assets in return for enough common equity to take the government stake toward 70%. New York range 1.4039/1.4304.
