A slight advantage went to the risk assets today in what amounted to a very quiet session for Asia. The big moves came early on as New Zealand posted surprisingly solid retail sales data, doubling the expected 0.5% with a 1.1% result. The reaction in the Kiwi Dollar was instantaneous as NZD/USD jumped from 0.7330 to a touch over 0.7390 on the news. NZD/JPY flew from 65.80 to over 66.30 as the AUD/NZD headed in the opposite direction, dropping from 1.2370 to 1.2280 lows. Although the AUD/USD was able to post a new 14 month high near .9094, the move lost steam on the AUD/NZD drop and rumors of a big option at the 0.9100 level. Many surmised the strong data will increase the chance for a rate hike from the RBNZ earlier in 2010 than anticipated.
EUR/USD moves were mostly sideways after a move higher stalled at the 1.4800 big figure. It seems like many players are keeping their chips off the table ahead of a slew of top tier US earnings due out over the next few days which should help determine the next dollar direction.
USD/JPY pushed slightly higher, although south of the 90.00 mark. The Yen crosses were slightly bid, although the GBP/JPY remained soft. Dovish expectations from the BoE have helped to paralyze the Pound from any upward moves despite stronger RICS housing and BRC retail data out early in the day.
German and Euro Zone ZEW should add volatility to London's session and looking ahead to the US, New York FOMC President Dudley and FOMC Vice President Kohn will be speaking at 17:15 GMT and 17:45 GMT respectively.
