- G7 officials to hold conference call on EZ debt situation
- G20 Asian official: G20 to encourage fiscally capable countries like Germany and Canada to spend more
- HSBC China services PMI 54.7; up from 54.1 last month and at 14-month highs
- Australian May current account deficit AUD$14.9 billion, as expected
- Fitch ratings: China credit slowdown gathering pace but still outpacing GDP
- Asian sharemarkets rebound, +1% on average
- Gold $1621/oz; Oil $84.75/bbl
After a very quiet first 3 hours of trade, the EUR sprang into life right on the Tokyo open, with EUR/JPY gapping 15 pips higher. This move soon translated into a stop-loss hunt in EUR/USD, with stops getting triggered above 1.2520 and again above 1.2530. The announcement of an emergency G7 conference call, which will deal only with the EZ debt situation, also added to the uncertainty and encouraged short-covering in the EUR. EUR/USD has traded quietly in a 20 pip range since the earlier break higher. Overall range: 1.2490/1.2542
AUD/USD has been a bit nervy ahead of the RBA decision, which is due very shortly. The market has priced in a 25bps rate cut but this hasn’t stopped the AUD moving higher through the session. Very solid sell orders between .9660/70 certainly slowed progress and dealers were unable to trigger well chronicled stops above .9775. This meant that they had to bail out of intraday longs as the meeting time neared. Ranges: .9711/71
USD/JPY has only moved alongside cross flows inside a fairly tight 78.24/40 range.
Cable 1.5371/1.5407; EUR/GBP .8119/41; EUR/CHF 1.2005/15
