Previous session overview
The euro fell to its lowest level in more than three months versus the dollar in Asia Wednesday after bad Australian economic data highlighted the extent of the global slump, prompting investors to sell riskier currencies.
The greenback rose to a 2-week high against the euro on Tuesday after Fed Chairman Bernanke warned that the banking system was not yet stabilized and that more measures were needed to lift the economy from a recession.
On Tuesday, EURUSD again showed some intraday volatility, but in a broader perspective, the pair extended the very gradual slide that was already in place for quite some time. On Monday, the pair felt some (albeit moderate) pressure from the selloff on the global stock markets. Market disappointment on the outcome of the EU summit with respect to central Europe, was a negative factor, too. EURUSD closed the session at the lower end of the intraday trading range at USD1.2561, compared to USD1.2578.
The British pound erased earlier gains against the dollar after UK share prices turned negative, and data showed February UK construction activity shrank at a record pace.
On Tuesday, USDJPY moved again higher after a brief intermezzo on Friday of last week and on Monday. Poor US eco data (pending home sales) and the hesitant performance of the US stock markets were not really able to deter USD-buyers. USDJPY closed the session at JPY98.16, compared to JPY97.45 on Monday.
The Canadian dollar rallied overnight against the greenback, but consolidated gains after the Bank of Canada cut rates by 50 basis points, bringing down their benchmark rate to a record low 0.5 percent.
The Australian dollar was weaker late Wednesday after a shock decline in gross domestic product increased expectations that the central bank will resume its monetary easing as early as April.
Market expectation
EURUSD makes a brief show back under USD1.2500, with rate meeting demand in the area around USD1.2495 before edging back above the figure. Recovery extends above USD1.2520 and looking to challenge reported resistance now at USD1.2530. Above here and rate can push toward USD1.2540/45. Rate appears to be playing 76.4% retracements on current gyrations, traders suggest.
Pound extended recovery highs to USD1.4090, the break below stg0.8900 in euro-sterling provided the added upside impetus to take cable higher. Offers reported in place toward USD1.4100. Rate currently holds back around USD1.4075. Support now seen placed at USD1.4050/45 ahead of recent pullback lows at USD1.4030.
EURGBP stops below stg0.8900 targeted and triggered, with rate extending lows to stg0.8885 before recovering back above the figure. Bids remain in place at stg0.8885/80 with stronger support noted behind at stg0.8860. Resistance stg0.8935/40.
Most important events of the day
| 4-Mar | Count. | Event | For | Unit | Imp. | Act. | Cons. | Prev. |
| 0:00 | NO | Norges Bank Deputy Governor Qvigstad to speak at a seminar organised by the Norwegian University of Science and Technology | Low | |||||
| 0:00 | EU | European Commission is expected to propose a new financial supervisory structure | Low | |||||
| 0:01 | GB | Nationwide Consumer Confidence | Feb | Index | Med | 38 | 40 | |
| 0:30 | AU | GDP | Q4 | % q/q | High | 0.2 | 0.1 | |
| 0:30 | AU | GDP | Q4 | % y/y | High | 1.2 | 1.9 | |
| 1:30 | JP | BoJ Board Member Suda to hold speech at a business meeting in Kyoto City | Low | |||||
| 2:00 | NZ | ANZ Commodity Prices | Feb | % m/m | High | -4.3 | ||
| 8:30 | SE | Swedish National Debt Office to publish 'Central Government Borrowing - Forecast & Analysis 2009:1' report | Low | |||||
| 8:45 | IT | Services PMI | Feb | index | Low | 39.6 | 41.1 | |
| 8:50 | FR | Services PMI | Feb | index | Low | 40.1 | 42.6 | |
| 8:55 | DE | Services PMI | Feb | Index | Low | 41.6 | 45.2 | |
| 9:00 | GB | Halifax House Price Index (4th-6th) | Feb | % 3m y/y | Low | -17.8 | -17.2 | |
| 9:00 | GB | Halifax House Price Index (4th-6th) | Feb | % m/m | Low | -2 | 1.9 | |
| 9:00 | EU | Composite PMI | Feb | index | Low | 36.2 | 38.3 | |
| 9:00 | EU | Services PMI | Feb | index | Low | 38.9 | 42.2 | |
| 9:00 | IS | Trade Balance (P) | Feb | ISKbn | Low | 0.3 | ||
| 9:30 | GB | CIPS Services PMI | Feb | index | Low | 41.9 | 42.5 | |
| 10:30 | GB | BRC Shop price index | Feb | %y/y | Low | 1.1 | ||
| 13:15 | US | ADP Employment | Feb | k | Med | -630 | -522 | |
| 13:30 | US | Dallas Fed President Fisher to speak before a breakfast meeting at the Texas Christian University | Low | |||||
| 15:00 | US | ISM Services | Feb | index | Low | |||
| 15:00 | US | ISM Non-Man | Feb | index | Low | 41 | 42.9 | |
| 15:00 | US | Treasury Secretary Geithner to testify before the Senate Finance Committee on the Treasury Department budget for 2010 | Low | |||||
| 17:00 | US | Atlanta Fed President Lockhart to speak before a Greater Miami Chamber of Commerce luncheon on the U.S. economy and outlook | Low | |||||
| 19:00 | US | Fed Beige Book | Low | |||||
| 21:45 | NZ | Wholesales Trade | Q4 | % q/q | Low | -1 | ||
| 23:50 | JP | Capital Spending | Q1 | % q/q | Low | -15.5 | -13 |
