The NY session was choppy to say the least and the dwindling of risk appetite helped the US dollar rebound modestly. US stocks managed to close up on the day, but the 0.3% gain was meager compared to European and Asian marts. Not even a booming new home sales report could help make for a euphoric market. US new home sales shattered expectations by rising to 384K in June from a 346K prior result. The better number was on the back of massive price capitulation – median prices fell nearly -6% month-on-month – and this was cause for pause.
The trade in currencies was in tandem with the price action in equities again. EUR/USD took a spill towards the 1.4200 area but managed to bounce back and closed near 1.4230. The yen crosses looked much the same, with EUR/JPY slipping to a 135.20 session low before grinding back up to a 135.50 close. We expect the price action in stocks to continue to dictate the pace as we head into the overnight sessions.
Oil closed the day relatively unchanged but the run-up towards $69/bbl had implications for the so-called commodity currencies. USD/CAD squeezed down to 1.0779 before rebounding smartly into the NY close. This was the lowest print since early October, before the financial market meltdown began in earnest. The pair is now trading near levels that elicited concern from the Bank of Canada and this could prove to be robust support for the medium-term.
Upcoming Economic Data Releases (Asia Session) prior expected
- 7/27/2009 22:45 GMT NZ Trade Balance JUN 858.0M 215.0M
- 7/27/2009 22:45 GMT NZ Imports JUN 3.10B 3.20B
- 7/27/2009 22:45 GMT NZ Exports JUN 3.96B 3.40B
- 7/27/2009 22:45 GMT NZ Balance YTD JUN -3044 -2614
- 7/28/2009 0:00 GMT AU Conference Board Leading Index MAY 0.70% - -
- 7/28/2009 1:30 GMT AU NAB Business Confidence 2Q -24 - -
- 7/28/2009 3:00 GMT AU Reserve Bank Governor Stevens Speech
