PBOC widens CNY band and Spain still in the spotlight
City Index April 16, 2012 1:00 PM
<p>EUR/USD Range: 1.2993-1.3082 Support: 1.2980 Resistance: 1.3100 With equities continuing their slide in Asia from last week and the PBOC doubling the CNY band to […]</p>
With equities continuing their slide in Asia from last week and the PBOC doubling the CNY band to 1% the USD was in good form on the open in Sydney. The market then picked up on an article in the WSJ that Moody’s Investor Service has placed various ratings of 114 financial institutions in 16 European countries on review for a possible downgrade. The market has serious concerns over Spain with CDS’s spreads widening towards levels that caused the Greek government to ask for a bailout.
Range: 1.5820 – 1.5863
Sterling continues trade in a 1.5800-1.6000 range with the pound having a slight bid bias as European concerns weigh on EUR/GBP with technical traders looking for a break of 0.8200-0.8210. This week we see important data releases for the pound in the form of the CPI data tomorrow with some expecting a rise to 0.4% and the MPC minutes on Wednesday to reveal members thoughts on further QE measures.
The JPY trades with a bid down dominated by selling in EUR/JPY with the next major support not seen until 104.24. The market will get a look at the US economic recovery story this week with the release of retail sales and industrial production data along with surveys from the Empire state and Philadelphia Fed. It’s also a busy week for US companies reporting earnings with top tier names like Citigroup, GS, IBM and Intel all set to report.