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European Open: The Ground Beneath The Feet
10.05.2012
Market seems to be in a state of dilemma, unable to decide on whether it is on a more solid footing than yesterday after the Australia employment data or weak after the China trade data. The ground looks shaky but the selloff has started not just yet. Equity trades flat to slightly negative, G10 currencies are in the middle of their ranges for the day and USD Asia is edging to break higher but seems to be on hold
New York ended the session with Eurozone political drama far from over. Our Eurozone Cheat sheet can be found by clicking here.
AUDUSD took the limelight this morning with the employment data coming out much stronger than expectation. The unemployment rate fell to 4.9% (expected 5.3%). The employment change came at 15.5K (expected -5K).
AUD jumped from 1.0060 to 1.0120. AUDNZD jumped from 1.2810 to 1.2850 and EURAUD fell from 1.2865 to 1.2810. As per our Todd Elmer, the head of G10 FX Strategy ex Japan, the reading is AUD positive and should see rates coming off a bit. But he does not expect any major changes in the outlook of AUD fx or rates in long term, without a change in external backdrop. Full comments from him can be read here.
The bullishness post the AUD data however was short lived as the China trade balance numbers hit the market soon.
This is an excerpt of CitiFX Research & Commentary as received in full by CitiFX Pro clients. It is provided to you only as an example of information made available to CitiFX Pro clients, and it does not contain the full analysis, conclusions, or other information found in original document.