The Eurozone’s finance ministers’ conference call managed to secure fresh resources for the IMF, though again there was a distinct lack of unanimity. Only four non-Eurozone nations agreed to participate. It had been hoped that the fund’s resources could be boosted to EUR200 bn but instead only EUR150 bn was pledged. The IMF said it ‘welcomed’ the ‘substantial’ boost to its resources, though there are some strict conditions attached to prevent the impression that the funding lines via Eurozone national central banks is simply debt monetization by stealth. The Eurozone financial leadership yet again failed to agree upon an expansion in resources for the combined EFSF and ESM, which still stands at EUR500bn amid stiff German opposition. The RBA minutes produced little in the way of surprises. The Japanese government again announced plans to boost its FX intervention capacity, but there was no currency reaction. EURUSD traded 1.2988-1.3020 and USDJPY 77.92-78.06. The Riksbank policy decision is due.
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UBS Investment Bank