This is a review of the elements likely to affect foreign exchange
(Forex) trading in the European session:
Obama takes offensive against Romney in rematch - Reuters
Spain Keeps Moody's Investment-Grade Rating - Bloomberg
Goldman Sachs's O'Neill Sees Bank of BRICS Gathering Momentum - Bloomberg
Pandit Forced Out at Citigroup - WSJ
U.S. Industrial Production Rises in Stabilization Sign - Bloomberg
Builders Probably Began Work on Most U.S. Homes in Four Years - Bloomberg
Obama takes Romney head-on in debate - FT
Candidates Tangle in Tense Debate - WSJ
Citi CEO Pandit exits abruptly after board clash - Reuters
Intel to slow production as PC sales drop - FT
MasterCard mines data for marketers - FT
Canadian Dollar Falls as Carney Douses Rate-Increase Speculation - Bloomberg
Asia Stocks Rise, Euro
Strengthens on German Bailout Stance - Bloomberg
Chinese slowdown a drag on US earnings - FT
China Slowdown May Be Tolerated as Job Needs Shrink - Bloomberg
PBOC Injects Less Cash - WSJ
Japan Closes In on China as Biggest US Debt Holder - CNBC
Japan to Hold Special Cabinet Meeting After Stimulus Reports - Bloomberg
Foreign brokers set to sell Japanese stocks - Reuters
Gillard Surplus Amid BHP Slump Cuts Bond Risk - Bloomberg
Singapore September Exports Unexpectedly Decline on Electronics - Bloomberg
Vietnam Ascent Threatened by Middle-Income Trap - Bloomberg
International Demand for U.S. Assets Rises on Europe - Bloomberg
Opposition wanes to Spanish aid request - FT
Spain Getting Precautionary Credit Line Positive, Pimco Says - Bloomberg
Euro hits 1-mth high after Moody's affirms Spain rating - Reuters
Euro Touches Month-High on Spain Optimism Before Summit - Bloomberg
Pound Drops Against Euro as U.K. Inflation Slows; Gilts Decline - Bloomberg
View: Europe Must Do More to Save Currency - Bloomberg
EUR: The euro is showing strength across the board. Spanish woes have waned a tad due to positive news out overnight. Moody's has kept Spanish debt above investment-grade at Baa3, with a negative outlook. There is also less opposition from Spanish authorities to request a sovereign bailout. That will be the main topic at the EU Council meeting that starts tomorrow in Brussels. As we expected, EUR-USD yesterday confirmed the breakthrough of the 1.30 resistance zone and rallied past 1.3100. EUR-JPY is trading above 103.00.
GBP: The sterling crosses are moving in synch with euro ones. Cable is close to 1.6140 while GBP-JPY is a tad above 127.00. EUR-GBP has breached the 0.8100 resistance zone and is trading near 0.8125. Today, all the attention will turn to the latest MPC minutes. The BOE is likely to maintain its ultra-accommodative stance for the time being. They might wait until early next year to see if more easing is needed.
CHF: The Swiss franc is continuing to advance against the greenback. USD-CHF yesterday broke the 0.9300-0.9400 range. It is now trading close to 0.9230. EUR-CHF can be found near 1.2100.
Nordics: The Swedish krona and the Norwegian kroner continue to show a mixed performance. Both the SEK and the NOK are advancing against the dollar
but losing ground versus the almighty euro. EUR-SEK is pivoting in the 8.6450 area and EUR-NOK can still be found in a triangle technical pattern trading close to 7.40.
USD & JPY: The US dollar is being sold across the board and the Japanese yen is in demand. Upbeat macroeconomic figures in the US are giving a boost to beta-seeking strategies. Japanese authorities are studying new stimuli to jump-start the economy. The most recent TIC survey highlights that Japan is closing in on China as the biggest US debt holder. Today's USD trading could be affected by housing figures in the USA.
CAD, AUD & NZD: The Canadian Dollar is making headlines as there is growing speculation about an interest-rate increase by the BOC. USD-CAD leaped yesterday towards 0.9885 resistance. Bids are up on the Aussie and the Kiwi before Chinese GDP data scheduled for tonight.