The US Dollar was able to take a step back from lows but was still precariously close to them in a day that saw light flows and little action. The US Federal Reserve spent most of the NY day emphasizing the fact that rates in the US will remain low for an extended period of time, talk that would do nothing to buoy the sinking dollar. Further comments by Fed Chairman Bernanke that looked to reinforce the central bank's ''Strong dollar policy'' fell mostly by the wayside.
EUR/USD made a 30 pip push to flirt with the 1.5000 level, but eventually succumbed to profit taking on a slide to 1.4950. GBP/USD remained well off of its earlier 1.6876 NY highs, only managing a session high through the 1.6840 level. The pair was helped to its summit by BoE comments that the recession in the UK is over and done despite a lack of economic figures to back the statement.
The AUD/USD was knocked off of its 0.9375 perch by the RBA monetary policy meeting minutes were decidedly less hawkish than usual. The minutes put the possibility of a December rate hike further out of reach with the comments stating that, ''further gradual adjustment in the cash rate would most likely be appropriate over time...'' The news was clearly not to the advantage of the Australian currency as AUD/USD eventually slid to 0.9325 lows as the data sunk in. If the December meeting fails to produce a rate hike, the next possible chance for the RBA to raise rates will be in February of 2010.
USD/JPY remained range bound and stale, as it wallowed between 88.90 and 89.15 for the better part of the day. The launch of two large Japanese Toshins (mutual funds) expected to see buying interest in non-Japanese markets failed to budge the stagnate yen as was expected. The yen crosses mostly traded sideways as investors kept an ear open for comments out of China during the first visit of US President Obama.
Gold continued its sell-off after a record high just north of $1143.00 in New York. Profit takers were quick to cash in as they hit bids down to $1134.00 as London prepared for the trade day.
