The Dollar continued its weakness against the Euro moving towards 1.4620 as jobless claims reduced while the trade deficit widened to 12 year high. The initial jobless claims rose 550,000 lesser than the estimated rise of 560,000 while the total claims were 6.02 million against expectation of 6.2 million. Trade deficit widened $32 Billion as demand for autos spurred imports leading to weakening of the US Dollar. The Dow Jones index crossed the 9600 mark topping at 9633 on the jobs data.
The Bank of England (BOE) left their interest rates unchanged at 0.5%, their lowest level ever while also maintaining the asset purchase plan at 175 Billion Pounds indicating that the UK economy won't exit the QE program soon and that the interest rates won't be increased till next year. The Pound moved higher on this news moving to a high of 1.6680 while holding below the key level of 1.6720.
The Bank of Canada (BOC) kept its interest rates unchanged at 2.5% while also adding that the second half recovery would be better than previously expected while also adding that the interest rates won't be hiked until the second quarter of 2010. The USD/CHF continued to decline closing lower at 1.0356 as the Franc continues to be stronger against the USD while the Swiss Bank has so far restrained from intervening to weaken the CHF.
OPEC decided to keep its production levels unchanged as the oil has been moving in their desired price range while moving back to high of $72.44 after correcting itself to below $70 after moving to $75. OPEC is keeping a watch to demand factors as well as economic growth which would support oil prices.
Important news today would be the Wholesale inventories, University of Michigan Confidence report as well as the Monthly Budget Statement from the US. Although confidence levels have dipped in past few weeks, it is expected to improve as the economy has been improving with signs of stability.
G10 Advancers and Decliners vs USD
R 2: 0.8813
R 1: 0.8695
S 1: 0.8507
S 2: 0.8379USDCAD
R 2: 1.1100
R 1: 1.0950
S 1: 1.0630
S 2: 1.0545EURJPY
R 2: 136.10
R 1: 135.00
S 1: 132.75
S 2: 131.75