- S&P Case-Shiller home price index rises 0.5% in May, first time in nearly three years; drops 17.1% vs July 2008
- Conference Board’s US consumer confidence index falls to 46.6 in July from 49.3 in June; weak
- Richmond Fed manufacturing index rises to +14 in July from +6 in June
- Chinese vice-premier Wang: US must manage the supply of dollars
- PBOC’s Zhou: “Touched on” currency issues; no in depth discussion
- UK Treasury: Inflation could be a problem when global recovery takes hold
- Pimco’s El-Erian: Too early for all-clear on recession
- US 2-year note auction lackluster; indirect bidders take 33% versus 50% last time
- Fed’s Yellen; Fed has the will to tighten before employment fully recovers; policymakers learned lessons of ’70s-era inflation
- Canada’s Flaherty: Unemployment to rise despite signs of economic stabilization
- oil falls $1.15 to $67.25; gold falls more than $20 intraday as dollar strengthens
- S&P 500 falls 0.25%; rallies sharply at close again
EUR/USD was unable to maintain levels above 1.4300 today and slipped back on profit-taking. The failure to find strength from the first monthly uptick in the Case-Shiller home price index was the death knell for the bulls intraday as the reflation trade was quickly unwound. Selling accelerated upon losing 1.4200 and 1.4170 supports. Chinese bids slowed the slide for a time but the market worked their way through them and fell to 1.4130, not far from the spike low at 1.4120 last Thursday evening. The market spent the afternoon backing and filling with sellers on rallies to the 1.4170/80 area seen; More sellers are eyed toward 1.4215/20. It is hard to get bearish on EUR/USD until 1.4120/30 gives way, but the lack of upside for the EUR despite upbeat US economic data (on balance) is troubling for the bulls.
AUD/USD fell on profit-taking along with EUR/USD today after rallying to fresh highs for the year overnight. The move back through the 0.8263 level from above prompted short-term specs to cut positions. Prices slipped to 0.8220 before stabilizing. The close at 0.8280 is a positive for the medium-term bulls.
The Loonies performance was less compelling for a change. USD/CAD fell to 1.0751 in London but prices squeezed up to 1.0905 as the dollar rebounded during the US morning. USD/CAD closes above the previous 2009 low at 1.0780.
