FxBriefs Weekly Wrap Up

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WEEKLY WRAP UP: June 29, 2013 FxBriefs US wrap: Surprisingly strong dollar demand for month-end JUN. 28, 2013 20:00 GMT Fed’s Stein puts focus on September for date when Fed will begin taper ECB’s Noyer: ECB stands ready to act if necessary; policy to remain accommodative as long as necessary; ECB can’t use unconventional policy like Fed, BOJ Fed’s Lacker: Fed not only leaving punch bowl in place it is still spiking the punch, albeit at a reduced pace; September one possible date for taper but depends on data USD, AUD and CAD gain reserve share: IMF Chicago PMI slides to 51.6 in June from 58.7 in May University of Michigan consumer sentiment index rises to 84.1 final in June from preliminary 82.7 S&P downgrades Cyprus to selective default, ECB suspends eligibility of sovereign debt as collateral S&P 500 falls 0.5% US 10-year note rises 2 bp to 2.497% EUR/USD rallies strongly in early US trade, reaching 1.3103 early on before falling sharply as dovish ECB comments and talk of a September taper helped bolster the dollar. Much of the dollar demand was flow driven, to be honest, not a result of headlines. Dealers expected more mixed business at month-end but it turned out to be one-way traffic for the dollar. USD/JPY reached 99.45, EUR/USD fell to 1.2992 near the month-end fixings. Next week will be huge with multiple central bank meetings as well as loads of important US data (ISM, NFP). Expect more volatility ahead. FxBriefs European wrap: Subdued month/quarter end so far JUN. 28, 2013 10:20 GMT Draghi discusses additional bond-buying plan: Sueddeutsche Zeitung Merkel advisor Schmidt: ECB rates may be low ‘for years’ BOJ Dep Gov Nakaso says no more easing needed now - WSJ PIMCO’s Amey: Market has overacted to Fed tapering talk - Bloomberg TV Chinese Vice President: China able to keep 7% growth rate “in the future” German May real sa retail sales +0.8% m/m, stronger than +0.2% median forecast UK’s Nationwide house prices rise +0.3% m/m, +1.9% y/y in June, pretty much as expected Swiss KOF June leading indicator rises to 1.16 from 1.09 in May French May consumer spending +0.5% m/m, better than -0.1% median forecast French public debt rises to 1.87 trln at end of Q1 2013 Tempers fray in France as drastic cuts loom - AEP at The Telegraph Month/quarter end has been a subdued affair so far. We’ve seen some Japanese yen weakness, but nothing major.  Nikkei gains, talk of toshin-related yen sales, talk of negative month/quarter end yen flows have all helped weigh on the Japanese currency. USD/JPY up at 99.00 from early 98.75, having been as high as 99.13 after buy stops tripped through 99.00. Talk of more buy stops up in the 99.15/20 area. EUR/USD effectively unchanged at 1.3060. Early rally couldn’t get through well-documented sell orders up at 1.3070/80 (area holds 200/55 dma) Buy stops above there ahead of more sell orders clustered 1.3100/10. Cable touch easier at 1.5245 from early 1.5265. Fxbriefs Asian wrap: Higher equities leading the way down this neck of the woods JUN. 28, 2013 04:28 GMT The “old lady” is looking for a new deputy governor Australian Private Sector Credit 0.3% MoM, 3.0% Y/Y Tempers fray in France as drastic cuts loom  (AEP) Largarde hopes Europe will one day appreciate IMF New Zealand Building permits rose 1.3% Japan’s Jobless rate 4.1% Japan’s National CPI -0.3% Y/Y Japan’s Industrial Production rose 2% M/M Japan’s retail sales rose 1.5% in May Amari: We are on gradual trend out of deflation EU leaders set to slow support for ailing banks in crisis plan China’s Zhou: Consumer prices are stable / Current monetary policy is appropriate                         Will adjust market liquidity as needed. AUD/USD opened the day around 9280, falling gold price, various sell fixes and Shanghai comp opening down -0.7% had the AUD under intense pressure, falling to 9215 before any real buyers emerged. The recovery in gold and the Shanghai comp going into positive territory, produced bargain hunters pushing the pair back up, more toshin interest similar to yesterday was also a driving factor, sending the antipodean back to 9250. USD/JPY opened at the lows of 98.35 and drifted higher, the catalyst came from the futures market indicating decent gains for the Nikkei. After a good two way battle around 98.55, stops were tripped above 98.80, the buying was all Japanese and thought to be linked the toshin  launches. We stopped just shy of 99.00, stops are said to be above 99.05 and 99.30, dips have remained shallow and so far limited to 98.70. EUR/USD  opened at 1.3038 and was dragged higher on cross flows, mainly EUR/JPY that rose from 128.18 to 129.37 on the day, gains linked to the toshin demand. The move stalled in the mid 1.3070s, 50 100 and 200 Day-MA’s  are all between 1.3070/1.3079. Was this email forwarded to you? 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