Monthly Archives: March 2012
RBA upbeat on stability of local banking system; AUD top-heavy
The RBA’s Financial Stability Overview painted a quite upbeat picture of the local banking system and, in a similar vein to member Debelle’s speech yesterday, offered assurance that the system was well-capitalized and well-positioned to meet the requirements of the Basel III accord.
AUD/USD Analysis
Opened in Asia at $1.0459 after trading down from $1.0558 to $1.0453 on some heavy leveraged and corporate supply particularly through the EUR, JPY and Canada crosses. There has been little change in tone this morning with further EUR/AUD demand weighing on the AUD and steady year-end yen demand pressing AUD/JPY lower.
UBS Morning Adviser Asia
Dollar Recovers The US dollar is sporting a steadier profile in Asia, having reclaimed some lost ground against the majors overnight amid the equity market pullback. Still tempering the US dollar’s upside is the cautious stance of Fed Chairman Bernanke, who said in a transcript of an impending television interview that “it’s far too early […]
UBS Morning Adviser America
EUR Continues Recovery The euro continues to make headway as a combination of auctions and positive moves in periphery debt markets provided an additional tailwind, on the back of Bernanke’s comments yesterday. On that note, we continue to question whether the market has been overemphasizing individual phrases contained in the Chairman’s speech, rather than looking […]
GBP Analysis
GBP closed in NY at $1.5966, off NY rally highs of $1.5974 and seen after markets reacted to dovish comments from Fed’s Bernanke. Rate touched an early high in Asia of $1.5972, as early direction was dictated by strong GBP/JPY demand, but move held off the NY high as well as the reported option barrier […]
FX Ringside
Risk-on as euro outlook continues to stabilize The euro remains surprisingly strong, probably still benefiting from short-covering previous very stretched, negative positioning in the currency. This situation is likely to continue for some time yet with the Euro-zone at least temporarily stable due to Greece being no longer in focus and European banks apparently possessing […]
EUR Analysis
EUR/USD closed in NY at $1.3360, off traded highs at $1.3368 and seen after markets reacted to Fed Bernanke’s dovish comments. Rate basically flatlined through Asia with trade contained within a tight range of $1.3343/66.
JPY Analysis
JPY opened in early Europe at Y82.80 and Y110.55 after a brief low of Y82.80 headed higher on investor demand, taking out CTA stops at Y83.00 to highs of Y83.04. Exporter and fixing supply then weighed with the USD easing back to Y82.80.
Daily FX Technical Strategy: US Dollar dip helps prop up commodity currencies
Commodity prices are benefiting from the near-term dip in the US dollar. Brent crude has broken bullishly from its contracting range and copper looks set to follow suit, with a similar bullish set-up confirmed on a break above 8660. On the back of this, commodity currencies are also turning positive within range.
FX Daily Strategist: Europe
Bernanke drive the USD lower, equities higher – but Treasury market is less impressed While the German IFO and a more positive outlook for this week’s Eurogroup meeting may have laid the groundwork, it was a dovish take on the US labour market from the Fed Chairman that had the greatest effect yesterday.
Technical Analysis – FX Daily Majors
Today’s highlights: · EURUSD: Clear break above 1.3292/94 negates any defensive bias for a more constructive tone, with risk to the 1.3487/3510 major resistance · GBPUSD: Eyes the Q1 recovery peak at 1.5991, through which opens the door to the Q4 (near 7-month) high, 1.6167 (interim hurdle 1.6090)
Bonds Analysis
German government bonds are opening higher Tuesday following dovish comments from Fed Chairman Bernanke and ahead of auctions from EMU periphery issuers. Traders also cite flight-to-quality buying on the back of an article in Der Spiegel released late Monday titled “The Hidden Risks Lurk in ECB’s Accounts”, and notes the central bank “may face hidden […]