European trading saw upbeat German & Euro Zone data underpin the Euro but the early USD strength helped offset any more significant knock-on. Offers around 1.2780/85 cap but stops above 1.2800/05 are targeted. Into North American trading and it is the ECB verdict & statement that is seen as the key short-term risk for EUR/USD.
Dealers no not expect to see EZ rates hiked intraday (Unch at 3.25%) but at the accompanying statement many are looking for a bout of Trichet "vigilance" to signal that a December rate hike is on the cards. Should the President err on the side of caution and a dovish comment is aired then the stops below 1.2730 & 1.2720 will be targeted. US data set for release today has Q3 productivity on the early run at 13:30 GMT with September Factory Orders then set for release at 15:00 GMT.
Fisher comments complete the daily diary while looking ahead, many eye the US Employment report set for release tomorrow. Option traders note 1.2800 barriers being protected but it is the large 1.2850 strikes, expiring Friday, that could limit any post payroll spot volatility.
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