Daily Forex Snapshots

European Session - CA Figures Disappoint Market

March 03, 2008 3:52 PM CET

G10 Advancers and Decliners vs USD

	JPY	1.06
	CHF	0.71
	SEK	0.37
	NOK	0.34
	EUR	0.29
	DKK	0.27
	GBP	-0.01
	AUD	-0.16
	NZD	-0.64
	CAD	-0.82

Global Indexes

Current Level

% Change

FTSE 100 Index	5,819.50	- 1.10
CAC 40 Index	4,729.88	- 1.26
DAX Index	6,642.69	- 1.56
SMI Index	7,424.60	- 1.45
DJIA futures	12,252.00	- 0.43
S&P future	1.330.20	- 0.08
Nasdaq futures	1,747.00	- 0.07

World Markets

Current Level

% Change

Gold	986.18	+ 1.23
Silver	20.39	+ 2.87
VIX	26.54	+ 12.79
Crude wti	102.02	+ 0.17
USD Index	73.68	- 0.04

Todays Calender

Estimates

Country / GMT

ISM Manufactoring (feb)	48.0	50.7	US / 15.00
ISM Prices Paid (feb)	73.0	76.0	US / 15.00
Construction Spending (jan) m/m	-0.7%	-1.1%	US / 15.00
Total Vehicles Sales (feb)	15.5m	15.2m	US / 21.00

Currency Tech

USDJPY
R 3: 110.10 T
R 2: 108.00 K
R 1: 105.00 S
CURRENT 103.13
S 1: 102.61 M
S 2: 101.68 S
S 3: 101.22 T

GBPUSD
R 3: 2.0100 S
R 2: 2.0000 P
R 1: 1.9976 M
CURRENT 1.9853
S 1: 1.9762 T
S 2: 1.9630 K
S 3: 1.9105 S

EURUSD
R 3: 1.5300 K
R 2: 1.5239 M
R 1: 1.5229 M
CURRENT 1.5219
S 1: 1.5144 M
S 2: 1.5000 K
S 3: 1.4500 P

S: Strong, M: Minor, T: Trendline, K: Keylevel, P: Pivot

Market Brief

Usd regained its footing after the mornings sell off in European session. UsdCad broke out of .9830 - .9860 range spiking to .9902 on weaker then expected GDP figures. GDP m/m slowed considerably to -0.7% vs. -0.2% exp while 4q fell to 0.8% vs 1.1% exp which is its first decline since sept 2006. Declining economic actively in tandem with the US will pressure the BoC to cut rates this week and add pressure on the Cad.

Swiss PMI dropped to 60.5 from 61.6 suggesting that pressure is mounting on the resilient Swiss economy. In our mind there is still uncertainty regarding the SNB rate decisions next week. Will growth seems to be sluggish residual inflationary pressure might cause the central bank to hold bank and wait for more data. Feb inflation is expected to remain flat at 2.4% but still above the bank's comfort zone. While the strong CHF should provide some inflation relief as the appreciation has been based on safe haven status and hence subject to market whims.

15.00gmt - US trsy sec Paulson speaks
19.00gmt - Fed's Kroszler speaks

Asian Session - UsdJpy Falls Below 103.00

March 03, 2008 9:30 AM CET

G10 Advancers and Decliners vs USD

	JPY	1.43
	CHF	0.75
	SEK	0.23
	DKK	0.16
	EUR	0.15
	GBP	-0.07
	NOK	-0.16
	AUD	-0.52
	CAD	-0.59
	NZD	-0.80

Global Indexes

Current Level

% Change

Nikkei 225 Index	12,992.18	- 4.49
Hang Seng Index	23,667.57	- 2.72
Shanghai Index	4,438.27	+ 2.06
FTSE futures	5,832.00	- 1.78
CAC futures	4,720.00	- 1.63
SMI Futures	7,530.00	- 1.29
DJIA futures	12,211.00	- 0.77

World Markets

Current Level

% Change

Gold	982.10	+ 0.81
Silver	20.06	+ 1.21
VIX	26.54	+ 12.79
Crude wti	101.93	+ 0.08
USD Index	73.53	- 0.24

Todays Calender

Estimates

Country / GMT

PMI Manufactoring (feb)	54.0	54.4	GE / 8.55
PMI Manufactoring (feb)	52.3	52.3	EC / 9.00
PMI Manufactoring (feb)	51.0	50.6	UK / 9.30
Euro-Zone CPI Est (feb) y/y	3.2%	3.2%	EC / 10.00
GDP (dec) m/m-q/q	-0.2%(1.1%	0.1%(2.9%)	CA / 13.30
ISM Manufactoring (feb)	48.0	50.7	US / 15.00
ISM Prices Paid (feb)	73.0	76.0	US / 15.00
Construction Spending (jan) m/m	-0.7%	-1.1%	US / 15.00
Total Vehicles Sales 8feb)	15.5m	15.2m	US / 20.00

Currency Tech

AUDUSD
R 3: 0.9578
R 2: 0.9555
R 1: 0.9500
CURRENT: 0.9320
S 1: 0.9266
S 2: 0.9122
S 3: 0.9006

EURJPY
R 3: 161.41
R 2: 161.04
R 1: 160.19
CURRENT: 156.16
S 1: 156.87
S 2: 155.80
S 3: 154.07

USDSGD
R 3: 1.4219
R 2: 1.4152
R 1: 1.4063
CURRENT: 1.3958
S 1: 1.3913
S 2: 1.3900
S 3: 1.3865

Market Brief

Usd was weaker in Asian session as another round of risk aversion took over the market. UsdJpy fell through the 103.00 barrier and the Nikkei dropped 4.6%. This added to investors' concern. The move on the Usd began on Friday when sluggish economic data hinted to a US falling or already in a recession which pushed the stock market and the S&P reelling lower; the S&P tumbling 2.7%. We expect the market focus to shift from recession to the prolonged effects of the economic downturn.

With the UsdJpy trading well below the 105.00 lvl markets will be listening and watching for any prospects of official intervention. We believe there is a very high likelihood of an official action. In fact the first verbal intervention came this morning when Cabinet Office Councilor Hamano comments that sharp moves for currencies were undesirable. In addition he mentioned that weak economic data from Japan had the market factoring in deflationary effects of a stronger Jpy which could warrant intervention (as this would be consistent with current monetary policy).

With the RBA meeting on Tuesday and the recent out performance of the Aud trading in the currency, this week should get intersting. We are expecting the RBA to hike rates 25bp to 7.50% with a hawkish accompanying statement. This combined with the above consensus on GDP growth (to be announced Wednesday) should be supportive for the Aud.

A number of central banks will be making monetary policy decisions this week, RBA, BoC, BoE, ECB and BoJ (see Central Bank Preview) which will dominate trading.

13.00gmt - Fed's Plosser speaks
14.00gmt - ECB's Council member Liikanen speaks
15.00gmt - US trsy sec Paulson speaks
19.00gmt - Fed's Kroszler speaks

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