USD

The greenback has rallied hard today as U.S. traders celebrate Thanksgiving and liquidity levels are very low across the board. Notable losers against the greenback have been the Pound, the Aussie and the Loonie.  Today's theme has clearly been one of risk aversion: the news that Dubai's sovereign wealth fund will seek to delay repayments on its debt has rattled investors across the globe and sharply increased yields on emerging market debt.  The gulf state's wealth fund has nearly $59 billion in liabilities which it is struggling to repay after wagering its future on becoming a financial center and tourist hub in the region.  Stock markets from Tokyo to London have dropped dramatically as the major european indices closed more than 3% in the red.

EUR

The united currency had a poor day as well, dropping to 1.4961 and currently struggling to regain the 1.5000 level.  The move mirrored the risk aversion sweeping the markets, but the Euro was battered by other economic news as well.  Eurozone M3 Money Supply came out lower than expected at 0.3% vs. a forecast of 0.8%, and reflected still-tight lending conditions in the banking sector.  Echoing this news, the head of the IMF, Dominique Strauss-Kahn warned that European banks still had large undisclosed losses hidden in their balance sheets.  This weekend ECB members are set to meet with China Prime Minister Jiabao and discuss a strengthening of the Yuan.  Hopes are not high after President Obama's failure to secure policy promises on the matter, and ECB officials are downplaying expectations ahead of the meetings.

JPY

USDJPY struck its lowest level in 14 years at 86.31 today as traders bet on the Yen after the Japanese government failed to send clear signals that it would intervene soon to stop Yen appreciation.  Despite rhetoric on the issue from the Prime Minister and the Finance Minister, analysts do not see the government interfering until USDJPY crosses below 85.00. Indeed the new Japanese government has been putting together its currency policy by the seat of its pants, and does not seem to be prepared for action despite the inevitable losses to its export sector.  The pairs lowest level was struck in 1995 at 79.75 after which the BoJ and Federal Reserve intervened to sell the Yen.  USDJPY is expected to continue to drop in the next week as technical support levels have disappeared.  EURJPY has dropped heavily today as well, but has found support at the 129.50 level.