- Japan govt keeps economic assessment unchanged for July
- German June wholesale prices -0.6% m/m, +8.5% y/y. Weaker than -.2%, +8.8% forecasts
- Japan EconMin Yosano: Volatile fx markets are undesireable
- Bank of Italy official: Burden of Italian spread widening limited in immediate term, would be damaging if these levels persisted
- ECB’s Draghi: Management of financial crisis so far has not been smooth, has increased market uncertainty
- ECB’s Draghi:Italian growth rates likely to remain below levels of main european partners over medium term
- ECB’s Draghi: BOI continues to ask Italian banks to maintain positions of balanced liquidity
- German Fin Min spokesman: No reason for rushed actions given that Greece is financed until September
- Irish PM: Time for Europe to respond comprehensively to debt crisis
- German Fin Min spokesman : Blessing’s proposal is one of many interesting suggestions on solution for eurozone crisis that need to be looked.
- EU Commission: Decision by Moody’s to downgrade Ireland rating is “incomprehensible”
EUR/USD bounced back from the 1.3980’s this morning with initial buying from the BIS taking prices above 1.4000. Italian spreads tightened sharply, prompting further buying from leveraged, Middle Eastern and Asian sovereign names which triggered stops through 1.4040 and 1.4060, before stalling in the 1.4070’s. A UK clearer then took the bat punching out stops at 1.4080 to $1.4111 before meeting headwinds from Russians and another Sovereign name out of Asia. Italian spreads are now starting to widen as the market waits for NY, driving EUR/USD back lower.
USD/JPY was sidelined for the morning, later drifting lower through reported semi-official bids at 79.20, from earlier highs of 79.58 to 79.15 with most of the action seen in the ozz and euro crosses.
EUR/JPY ran up to highs of 111.83 from 111.06 driven almost completely by the euro rally, and AUD/JPY followed to 84.82
from lows of 84.35 before easing back as Asian reserve offers in AUD/USD halted a rally at 1.0895 .
GBP/USD fell from early highs of 1.5990 to lows of 1.5906 on weak UK employment data, but picked up later with the EUR/USD to 1.5967
Gold extended its rise from yesterday falling inches short of the all time spot high of $1575.45.