Finport Currency Brief - Courtesy of Compass Global Markets.
Price action in the currency markets is starting to pick up now, as most market makers are back at their desks and we saw some volatility late last night when news hit that Chinese officials were considering scaling back their purchases of US Government Treasuries - which followed yesterday's news the Bank of Japan moved to do the same thing (less US$ buying).
The result of the above was the A$US$ exchange rate recovering all of the previous days losses, although we have drifted off slightly as the market takes advantage and congratulations to those clients that took my guidance to place target orders. Focus now turns to today's domestic Retail Sales numbers although reaction may be muted as we wait for more important US data tomorrow and any fall out from the above Sino-Japanese news. I favour A$US$ to hold here.
Over in Europe A$Euro is holding the range, as forecast yesterday, as is A$GBPound, although interestingly both pairs have traded at highs for a while now. This suggests that something has to give and the longer we hold on the larger the move is likely to be. Question is in what direction? Looking at the economic data calendar - we my have to wait till next week to get our answer.
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