FX Highlights

  • The USD is trading mixed to higher with GBP sharply lower pressured by report of a surprise decline in UK Q3 GDP, EUR rises to new high for 2009 supported by gains in cross trade to GBP and in reaction to EU flash manufacturing PMI which rose to a 22 month high, German IFO rises less than expected, JPY pressured by report that deflation pressures continue in Japan, commodity currencies lower pressured by spillover from weak UK GDP, Australia's export prices fall, BOC says intervention is an option, today's data from Europe shows that the UK economy is still in recession and the EU economy is emerging from recession
  • Focus turns to today's release of US existing home sales
  • UK advanced Q3 GDP fell 0.4%, a 0.2% rise was expected, UK mortgage approvals rise 76.8% in September, GBP sharply lower
  • EU October PMI rises to 22 month high at 53 compared to 51.1 in September, August industrial orders rise 2%, German October IFO rose to 91.9 in October compared to 91.3 last month, a reading of 92.3 was expected, EUR higher
  • BOJ sees inflation falling 1.3% in 2009 and 1% in 2011, deflationary pressures will keep the BOJ on hold, JPY lower
  • Australia's Q3 export prices fall 9.6%, import prices fall 3%, AUD lower
  • BOC Governor Carney says intervention is an option and notes inflation pressures are higher in Australia than Canada, BOC says Canadian economic recovery underway, CAD lower
  • Bloomberg reports that analysts at Scotia see the EUR trading at 1.6000 in the next six months with USD pressured by central bank selling as the global recover gains momentum
  • Treasury sets record 123 bln bond auction for next week
  • US equity markets set to open mixed, European equities 1%, Nikkei closed 16 points higher

Upcoming Events

  • US - Friday, September existing home sales will be released expected at 5300k compared to 5100k last month
  • CAN - Friday, no major reports are due for release today