Markets have been pretty much on hold Friday ahead of the U.S. nonfarm payrolls report. Data on hand painted a depressing picture, Halifax reported UK house prices fell 0.9% in Dec, the euro-zone unemployment rate stuck at 10.3% in Nov, while for the same month German industrial orders fell 4.8%. Swiss CPI fell 0.7% on the year, 0.2% on the month, against -0.6% and -0.1% expected. In currency markets, EUR/CHF showed minimal reaction to the Swiss inflation numbers, which were seen not bad enough to trigger the SNB into action and raise the 1.20 floor. EUR/USD printed a fresh 15 month low of 1.2763 in the Asian session, caught an early bid in Europe, but was then confined to a 1.2780-1.2813 range. GBP/USD traded 25 ticks either side of 1.55, and USD/JPY slipped from 77.20 to 77.02. In emerging markets, the Turkish central bank promised to strength the lira via intervention in 2012, while the HUF is off record lows vs EUR and USD as the Hungarian government shows more willingness to accept conditions for an EU/IMF bailout. Core European government bonds tread water, with March bunds 0.24 lower at 138.56, and March gilts up 0.05 at 116.24. Peripheral bond yields are off session highs, but Italian 10-year yields hold stubbornly above 7%. The main European bourses hold gains of around 0.5%, Italian bank UniCredit shares were suspended limit down. Gold is $1 lower at $1624/oz, February Nymex crude is up 70c at $102.31/bbl.
EasyForexNews Research Team