U.S. banks haunted by mortgage demons that won't go away.-Reuters
Apple's latest iPad makes low-key debut in China.-Reuters
Microsoft Swings to Loss.-WSJ
Mayer gets $70 million pay package to lead Yahoo.-Reuters
Canadian Dollar Reaches Two-Month High Amid Bets on Stimulus by Fed, China.-Bloomberg
Asia Stocks Drop With Euro on Global Concern
BOJ Shirakawa: Europe crisis risks further yen rise.-Reuters
Sinking China Profits May Pressure Wen on Taxes.-Bloomberg
Zuma warns on Africa's ties to China.-FT
Weakest Monsoon Since 2009 Seen Shrinking India's Rice Harvest This Year
Indian premier faces economic challenge.-FT
Thaksin Calls for Talks Over His Return to Thailand.-Bloomberg
German Lawmakers Back Aid for Spain.-WSJ
Greeks Brace for Pain on Wages.-WSJ
Spain Insists $15 Billion Aid for Regions Won't Swell Guindos Debt Plans.-Bloomberg
Spain Bond Sale Sends Chill.-WSJ
Ireland Bulldozes Ghost Estate in Glimpse of Life Following Housing Bubble.-Bloomberg
Euro slips on Spain worries, near record low vs Aussie.-Reuters
Warm glow of Sweden's 'all weather' currency.-FT
Regulator gears up wider Libor inquiry.-FT
Peugeot case reflects Hollande's dilemma.-FT
Edmund Phelps Germany is right to ask for austerity.-FT
EUR: The euro crosses are consolidating following yesterday's losses which were acute versus the GBP, JPY, AUD and other pairs. Spain's debt auction reminded the market that the European crisis is entrenched and there is renewed talk of a sovereign bailout after the summer. EUR-USD is moving in the middle of the 1.22-1.23 range. All eyes are set on the 1.21627 support level. EUR-JPY is holding above 96.00. Below that level Japanese authorities are prone to intervene to avoid yen appreciation.
GBP: The sterling crosses give up some of their recent gains. Eurozone risk aversion buttresses the pound. Public sector net borrowing figures are scheduled to be released today. The cable is now a bit below 1.5700, while GBP-JPY trades near 123.32. EUR-GBP breached yesterday the 0.7800 support zone but it is now above that threshold.
CHF: The Swiss franc is firmer against the dollar. The USD-CHF cross rate is consolidating after reaching a one and a half year high at 0.98731. In a wide sense the franc is considered to be a euro related play. Meanwhile, EUR-CHF is in its familiar trading range close to 1.2000. No change ahead expected as the SNB is still determined to defend that 'Maginot' line.
Nordics: Both the NOK and the SEK are moving sideways versus the dollar and the euro. They may finish the week with an upside bias that is specially acute in the SEK. The hawkish Riksbank minutes released this week show that the strong economic performance of Sweden could see he country avoid a rate cut below the current 1.50% level.
USD & JPY: The greenback and the yen are still preferred in a 'risk on-risk off' context. As previously thought, Bernanke's two day testimony in Congress, while acknowledging the slowdown of the US economy, gave no hint of further monetary stimulus. Our guess is for the arrival of QE3 as early as September. It could be preannounced in the mid-August annual Fed meeting to be held in Jackson Hole, Wyoming. USD-JPY dropped yesterday from the 78.50 zone and is now moving close to 78.58.
CAD, AUD & NZD: The three dollars take a much needed pause against their peers after their strong weekly behavior. USD-CAD finally broke the important support found in the 1.0100 area and fell towards parity. AUD-USD is still trading above 1.04.
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