Opening Comment 03.08
Initially, the Yen had been well offered on the news that the BOJ would be considering a fresh easing policy, and talk of intervention from the MOF, but US NFPs opened an aggressive acceleration of Yen selling, which drove many of the Yen crosses sharply higher.
Global equities are broadly higher, with some more positive and reassuring news out from Greece helping to bolster appetite. Greek central bank governor Provopoulos says there has been solid demand for Greek bond issues, while French PM Sarkozy says the Eurozone will do whatever is needed to make sure that Greece is not isolated.
Elsewhere, in China, the commerce ministry says it has been studying the impact of Yuan revaluation on exports, while PBOC Zhou says that China will eventually have to drop its special Yuan policy. Overall, currencies are well bid against the USD on a more optimistic outlook for the global economy, and it remains to be seen whether these gains can be sustained.
Looking ahead, Swiss unemployment (4.4% expected) is due at 6:45GMT, followed by Swiss retail sales (2.3% expected) at 8:15GMT. Eurozone sentix (-8.8 expected) is then out at 9:30GMT, with German industrial production (1.0% expected) capping things off at 11:00GMT. With the exception of the Yen, all major currencies are up against the buck, led by Kiwi. US equity futures are pointing to a firmer open, while gold trades flat and oil is bid up.
Written by Joel Kruger, Technical Currency Strategist for DailyFX.com
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