EURO bounced back

Asia just cruised through a rather quiet session that saw a weaker dollar amidst a busy data day that failed to illicit much response from the markets. The EUR/USD recovered from earlier lows near 1.3430 on the news that German bank West LB was in danger of being the first bank to be “bailed in” under year old laws if a rescue agreement could not be reached by Tuesday night. Those lows touched in New York, were erased in Asia as the pair reached levels over 1.3520 in modest trading. The potential for volatility remains if the bank and German government do not reach agreement by the midnight Tuesday deadline.

Out of Australia, the RBA meeting minutes confirmed that the current restrictive policy was still warranted, but the Australian currency remained steady. Softer than expected Chinese CPI data, 4.9% versus 5.3%, did help boost risk reasonably, putting the AUD/USD over 1.0055 for a 30 pip gain. AUD/JPY saw better gains, moving from 83.50 to over 83.85 on the news as the general tone of risk was elevated on the data that was leaked yesterday. The other yen crosses were propelled higher on the data as well, seeing EUR/JPY gain 60 pips to 112.90 and GBP/JPY gain 50 pips to 134.00 on the day.

The Bank of Japan offered the last release of the day with its overnight call rate remaining unchanged at 0.1% to little reaction in USD/JPY which stayed in a 30 pip range for the day. As well, the BoJ raised its economic assessment for the year in a rare bit of good news for the island nation. With the weaker dollar, gold, XAU/USD saw a $5 gain to $1366.00.

We have a pretty packed docket ahead in the London session with the releases of German Preliminary GDP and ZEW sentiment, UK CPI and RPI, followed by the Bank of England inflation letter.

Источник: FOREX.com

15.02.2011