European morning wrap: Odd scary moment, but generally a rather mundane month-end so far
- German parliament approves revised Greek aid bill
- EU official: Expect Greek buyback to be launched by Monday
- German October prelim retail sales -2.8% m/m, -0.8% y/y, demonstrably weaker than Reuters’ median forecasts -0.2%, +1.2% respectively
- Draghi: Crisis isn’t over yet
- More Draghi: Sees relative stabilisation of market conditions
- Even more Draghi: ‘We were living in a fairy world’
- Schaeuble: First successes seen in Greece rescue
- More Schaeuble: Failure to pass Greek aid would hit EU, beyond
- Lagarde: European economy is fragile
- More Lagarde: Correction of euro zone’s imbalances is far from over
- PIMCO’s Bosomworth: ECB should cut interest rates (no arguement here)
- Japan’s Noda: Will continue to act decisively in currency market. Would be wrong to have BOJ finance public debt, won’t take such policy
- Fitch: U.S. money funds increase exposure to eurozone banks for fourth month
- French October consumer spending -0.2% m/m, -0.5% y/y
- Swiss November KOF leading indicator falls to 1.50 from revised 1.64 in September (prev 1.67), weaker than median forecast of 1.60
- Euro zone November inflation estimated at 2.2% y/y, down from 2.5% in October and weaker than Reuter’s median forecast of 2.4%
- Euro zone October unemployment 11.7%, up from 11.6% in September and in line with median forecast
- Greek September retail sales -12.1% y/y after revised -9.3% in August
The major pairings showing little in the way of notable net change on the day as we head into month-end. Main feature would be further yen weakness. There has been talk of expected month end dollar demand versus likes of yen, euro and sterling. Expected moderate against the euro and cable, a little heavier against the yen.
USD/JPY up at 82.65 from early 82.45, EUR/JPY up at 107.55 from around 107.10.
Talk of very large 82.90 one-touch option structure rolling off at the New York cut later today. Also talk of barrier option interest placed up at 83.00, defensive sell orders just infront.
Talk of buy stops through 107.80 in EUR/JPY ahead of 108.00 barrier option interest.
EUR/USD fractionally firmer at 1.3005 from early 1.2995. The pairing spiked to session high 1.3029 (EBS) from circa 1.2995 just after the release of truly grotty German retail sales data (see above) Go figure? Honestly, I have no idea what was going on there and will likely go to my grave none the wiser. Month-end innit, anything can happen and usually does. Middle Eastern and Asian names reportedly sold into the spike.
Cable and AUD/USD effectively unchanged at 1.6045 and 1.0425 respectively.