Wednesday June 4, 2008 - 10:01:27 GMT
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FX Blog- Market Snapshot Europe Mid-Session 4 June 2008
GVI Market Snapshot- European Mid-Session for June 4, 2008
Profile of Key Markets:
- The USD is holding steady vs. the EUR from late Tuesday levels. The GBP has eased vs. the EUR and USD following a weaker than expected Services PMI report. A key focus now is BOE monetary policy with the central bank confronting high inflation and a weakening economy. The BOE is generally expected to hold policy steady tomorrow, but most expect several rate cuts by yearend.
- As for the USD, the markets are still digesting the verbal intervention in the U.S. currency by Bernanke yesterday. As a practical matter, his only forex management tool is verbal intervention at the present time. The new policy could face a test on Friday following the release of the May employment data.
- The EUR/USD trading back below the neutral 1.5500 line. The ECB policy decision (no change expected and press conference on Thursday will be closely watched.
- The USD/CHF is softer along with USD/JPY. The CHF/JPY is pivoting the psychological 100 line. The CHF is up against the EUR. The EUR is weaker vs. the JPY.
- Oil is soft in the wake of the USD recovery. It still is a key influence on the EUR/USD. Gold is down as well. The AUD has gained following stronger than expected GDP data.
- Asian equities were mixed. The better USD tone boosted the Nikkei. European bourses are weaker. The early call for U.S. equities is for a lower start. JGB prices fell sharply, while the prices on E-Z bonds have improved. U.S. bond prices are higher.
- Key data releases today include the ADP private jobs survey. See the GVI Calendar for the full schedule of key data.
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