The market continued to shed risk in NY trading after the massive rally in equities yesterday. Stocks plunged more than -2% but the S&P managed to close above the crucial 55 day moving average (805.23), suggesting the latest bear market rally may not be over just yet. Treasuries remained lower with the 10-year yield up 5 basis points to 2.70%, but did manage to rally a touch on news that the Fed will begin purchasing US paper tomorrow. Gold continued to lose ground and fell -$14 on the day thus far to the 926/925 zone.
The price action in FX was in line with the paring of risk. EUR/USD slipped about -70 pips and was sitting near 1.3450/60 and remains heavy while below 1.3480 here. Look for the pair to test towards 1.3400 if global equities follow US stocks lower. The yen crosses lost ground as well. USD/JPY was about -50 pips lower near 97.70 while EUR/JPY lost a more aggressive -140 points into the 131.50/60 zone.
Cable could not hold on to early session gains into 1.4770/75 and ended the session down about -60 pips near 1.4670 instead. The pound was not helped by comments from the BOE's Blanchflower who said that the UK is in a ''protracted recession'' and that policy may take a while to work.
Upcoming Economic Data Releases (Asia Session) prior expected
- 3/24 23:50 GMT JN Merchnds Trade Balance Total Bln FEB -Â¥952.6 -Â¥20.0
- 3/24 23:50 GMT JN Adjusted Merchnds Trade Bal. Bln FEB -Â¥364.9 -Â¥295.6
- 3/25 1:00 GMT NZ Westpac NZ Consumer Confidence 1Q 101.3 - -
- 3/25 2:00 GMT JN BOJ Deputy Governor Yamaguchi to Speaks
