By GCI Fx Research
€
The euro came off vis-à-vis the U.S. dollar today as the single currency tested bids around the US$ 1.3145 level and was capped around the US$ 1.3305 level. Minutes from the Federal Open Market Committee’s meeting that concluded on 18 March wer released in which the FOMC agreed on “substantial purchases of longer-term assets” and pessimisitcally said “further employment cutbacks” were expected. Some Fed officials saw inflation “below desirable levels” and Fed staff now see gross domestic product “expanding slowly” in 2010 with GDP growth “flattening out” in H2 2009. Fed officials said the economy is worse than thet expected and said there is a downside risk to the “already weak” economic outlook including more pressure on U.S. financial institutions. Data released in the U.S. today saw February wholesale inventories decline more than expected, off 1.5% m/m and 1.7% y/y. In eurozone news, German February manufacturing orders fell 3.5% m/m and 38.2% y/y. The European Commission today said it plans to raise the ceiling on its loan facility to non-eurozone countries to €50 billion from the existing €25 billion level. European Central Bank member Noyer said the French economy will improve at the beginning of 2010. Also, German factory exports slumped 23.1% y/y. Euro bids are cited around the US$ 1.3100 figure.
¥/ CNY
The yen appreciated vis-à-vis the U.S. dollar today as the greenback tested bids around the ¥99.30 level and was capped around the ¥100.85 level. Data released in Japan overnight saw the February current account surplus decline to 55.6% y/y to ¥1.12 trillion. These data underscore the tremendous decline in Japan’s foreign trade position over the past several months on account of the yen’s relative strength and the decline in global final private demand. Other data released today saw March corporate bankruptcy cases up 7.9% y/y. The Nikkei 225 stock index lost 2.69% to close at ¥8,595.01. U.S. dollar offers are cited around the ¥104.15 level. The euro moved lower vis-à-vis the yen as the single currency tested bids around the ¥130.95 level and was capped around the ¥133.75 level. The British pound moved lower vis-à-vis the yen as sterling tested offers around the ¥145.70 level while the Swiss franc moved lower vis-à-vis the yen and tested offers around the ¥86.45 level. The Chinese yuan appreciated vis-à-vis the U.S. dollar today as the greenback closed at CNY 6.8320 in the over-the-counter market, down from CNY 6.8361.
₤
The British pound came off vis-à-vis the U.S. dollar today as cable tested bids around the US$ 1.4635 level and was capped around the $1.4745 level. Data released in the U.K. today saw the March BRC shop price index climb 2.0% y/y from 1.9% y/y in February. Also, Nationwide March consumer confidence slid to 41 from 43 in February. Cable bids are cited around the US$ 1.4515 level. The euro came off vis-à-vis the British pound as the single currency tested offers around the ₤0.9050 level and was supported around the ₤0.8955 level.
Daily Market Commentary provided by GCI Financial Ltd.
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