MORNING BRIEFING: USD and YEN fall on increasing risk appetite

[RTFX-Trading]

MORNING BRIEFING: USD and YEN fall on increasing risk appetite

What’s new:
Forex: US Dollar and Yen sold off on increasing risk appetite
China: Obama tells Hu that Yuan needs to be market oriented
Forex: Singapore dollar strengthens after revaluation
Euro-zone: Europe’s rescue package still in the spotlight
United States: Important data and speakers today

Today:


Overnight Rates and Indices:
EURUSD: 1.3665 – 1.3603.
USDCHF: 1.0548 – 1.0502.
GBPUSD: 1.5439 – 1.5372.
EURJPY: 127.60 – 126.78.
USDJPY: 93.50 – 93.16.
DowJones: 11’019 +0.12%  
NASDAQ: 2’466 +0.33%
S&P 500: 1’197 +0.07%
Nikkei: 11’205 +0.39%.
Shanghai: 3’162 +0.03%,
Gold: $1’156.0
Crude Oil: $84.26

Comments:

As Asian stock markets advanced earlier on today demand for US Dollar and Japanese Yen retrieved. The market’s appetite for risk is increasing with improving global growth, hence the sell off for the safety-linked currencies.

At a news conference, at the end of the nuclear security summit, Obama said China has an interest in economic rebalancing.  Adding that China will, over time, have to shift away from an economy reliant on exports and give more importance to domestic consumption and production and preventing bubbles within the economy – and all of this will be precipitated with a more market-orientated currency approach.

The Singapore Dollar strengthened after the nation’s central bank revalued its currency. The Singapore dollar went 1.2% higher against the dollar on government announcing economy will expand as much as 9% in 2010.

Handelsblatt, a German newspaper, reports that Europe’s rescue package for Greece may turn out to be three times the sum originally announced citing unidentified people in the European commission. The package might amount to as much as 90 bn Euro. The newspaper also cited a German Government official saying that the package could at least be twice as high the amount communicated so far.

Today we have important data and speakers in the US. At 14:30 we will have CPI and retail sales followed by business inventories at 16:00. Also today Bernanke will be testifying before the joint economic Committee of congress.

Good Day

Rudolf Muscat

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