FX Highlights

  • USD is trading lower as the FOMC says interest rates will stay low for an extended period, GBP pressured by comments from BOE Governor King that weak GBP will help rebalance the UK economy, German IFO business confidence improves, EUR supported in cross trade to GBP, EUR/GBP at a five month high, JPY rallies 1% on technical buying and repatriation flows in front of Japans fiscal half year end on September 30th, JPY also supported by Yuan revaluation speculation, AUD supported by strong housing data
  • Focus turns to today's release of US jobless claims and existing home sales and the start of the two day G-20 meeting
  • FOMC holds policy steady said rates will remain low for an extended period, sees improvement in the economy up and the Fed extends deadline for MBS and agency debt purchases until end of Q1 2010, treasury purchases to expire in October
  • BOE governor King says UK growth may be beginning to pick up , Daily Telegraph reports that BOE will hold a crisis meeting with major economists next Tuesday, GBP lower
  • Japan August trade balance rose by ¥185.7bln,exports fall 36%,JPY higher
  • Australia’s new home sales rise 11.4%,RBA says bank loan losses may rise further, AUD higher
  • German IFO rises to 91.3 from 90.5 last month, current conditions improves to 87 from 86.2 last month, IFO official says it’s questionable if recent recovery is self sustainable, EUR higher
  • EUR trades at a three month low versus CHF after the release of weaker than expected German IFO, this will increase the risk of SNB intervention
  • BOC officials warn of risk to the recovery from strong CAD,CAD mixed
  • Russian Ruble hits nine month high versus USD
  • US equity markets set to open mixed, European equities 0.25% higher, Nikkei closed 173 higher

Upcoming Events

  • US- Thursday, initial jobless claims for week of 9/19 will be released expected at 540k compared to 545k last week along with August existing home sales expected at 5300k compared to 5240k last month
  • CAN –Thursday, no major Canadian economic data is due for release today