The euro recorded losses against most of its major counterparts, as market participants appear uncertain over the bond swap decision by private holders of Greek debt. The decision is due on Thursday and Greece via its Finance Minister Venizelos, already expressed its readiness to enable collective action clauses (CACs), if necessary. Such clauses, allow the majority of the private bondholders to agree to bond swap and this agreement will be legally binding to all debt holders, even those who opposed it. If this scenario materializes, it means that this forced debt exchange offer will be classified as a credit event and thus, credit default swaps (CDS) will be triggered. CDS is a swap agreement where the seller compensates the buyer in the event of a default or other credit event. All steps so far were carefully taken as to avoid triggering a credit event due to concerns over the potential impact across the European and global financial stability, and fears of Greek bank runs potential contagion to other eurozone countries. Against the US dollar, the single currency dropped to 1.3119 from 1.3222. Versus the Japanese yen, the euro dived to 105.79 from 107.82.
The US dollar produced gains versus a basket of currencies as risk aversion heightened and investors moved to the greenback’s liquid safety. Against the Canadian dollar, the greenback rose to 1.0013 from 0.9940, as the Canadian Ivey PMI came out better than expected. Versus the Swiss franc, the US dollar advanced to 0.9186 from 0.9119. Market participants will anticipate Friday’s Non-Farm Payrolls announcement to see whether the trend for the US economy.
Oil prices dropped to 104.59 from 106.85 dollars a barrel. Gold dived to 1674.20 from 1704.87 US dollars an ounce. Against the euro, gold slid to 1276.89 from 1291.03 an ounce. Silver fell to 32.9209 from 34.0184 dollars an ounce.
|EURUSD||1.3175||SHORT @ 1.3175||53% of deals buy EUR|
|USDJPY||81.15||SHORT @ 81.10||41% of deals buy USD|
|GBPUSD||1.5800||SHORT @ 1.5800||57% of deals buy GBP|
|AUDUSD||1.0610||SHORT @ 1.0610||57% of deals buy AUD|
|GOLD||1684||SHORT @ 1684||68% of deals buy GOLD|
|OIL||105.85||SHORT @ 105.85||64% of deals buy OIL|
|USD||13:15||ADP Employment report||208k|
|USD||15:30||Crude Oil Inventories||1 mil|
|NZD||20:00||RBNZ Rate Call||2.5%|
|FTSE 100||-1.86%||S&P 500||-1.54%||NIKKEI||-0.64%|