Daily Forex Snapshots

Asian Session - Waiting on The BoE & ECB

March 06, 2008 9:39 AM CET

G10 Advancers and Decliners vs USD

	SEK	0.20
	AUD	0.19
	NZD	0.17
	JPY	0.16
	EUR	0.09
	CAD	0.08
	DKK	0.07
	CHF	0.05
	NOK	0.03
	GBP	-0.18

Global Indexes

Current Level

% Change

Nikkei 225 Index	13,215.42	+ 1.87
Hang Seng Index	23,349.95	+ 1.01
Shanghai Index	4,360.99	+ 1.59
FTSE futures	5,855.50	+ 2.09
CAC futures	4,757.50	- 0.18
SMI Futures	7,315.00	+ 0.68
DJIA futures	12,297.00	+ 0.17

World Markets

Current Level

% Change

Gold	987.56	- 0.22
Silver	21.08	+ 1.24
VIX	24.60	- 3.60
Crude wti	104.30	- 0.21
USD Index	73.36	- 0.16

Todays Calender

Estimates

Country / GMT

Manufacturing Orders (Jan)	-0.4%(+9.9	-1.7%(+5.6	GE / 11.00
BoE Interest Rate Announcement	5.25%	5.25%	UK / 12.00
ECB Interest Rate Announcement	4.00%	4.00%	EZ / 12.45
Initial Jobless Claims (Mar 1st)	360k	373	US / 13.30
Pending Home Sales (Jan)	-1.0%	-1.5%	US / 15.00
Building Permits (jan) m/m	1.0%	0.04%	CA / 15.00

Currency Tech

AUDUSD
R 3: 0.9555
R 2: 0.9500
R 1: 0.9420
CURRENT: 0.9347
S 1: 0.9220
S 2: 0.9122
S 3: 0.9006

EURJPY
R 3: 161.05
R 2: 160.20
R 1: 159.22
CURRENT: 158.65
S 1: 155.95
S 2: 154.87
S 3: 154.07

USDSGD
R 3: 1.4220
R 2: 1.4151
R 1: 1.4063
CURRENT: 1.3872
S 1: 1.3882
S 2: 1.3865
S 3: 1.3800

Market Brief

EurUsd hit a high of 1.5306 in Asian session as the Fed’s Beige Book continued to shed light on the US dreary economic condition. The reported stated "economic growth has slowed since the start of the year, with about 2/3 of districts reporting softening." This was a stark contrast to the last release which stated "economic activity increased modestly, but at a slower pace compared with the previous survey period."

Crude oil rallied above 104bbl in US session as OPEC ruled to sustain the current output level while the US saw a sharp draw on inventories. Earlier in the session gold surged above the 990 lvl. Subsequently this pressure on commodities has been given the commodity bloc, especially the Aud and Cad, a decent lift.

As was widely expected the RBNZ left rate on hold at 8.25% and in the accompanying statement Governor Bollard said regarding inflation to "remain high," while on NZ growth "the outlook for economic activity has deteriorated somewhat" because of "weaker prospects for world growth, tighter credit conditions, a sharper-than-expected slowing in the housing market, and recent dry weather conditions." The Central Bank lowered its growth forecasts for 2008 to 3.1% and 2.6% and 2009 to 2.8% and 1.5%. Bollard confirmed that he expect rates to stay at this level of “a significant time." In balance the tone was still hawkish but slightly less than the last statement. The combination of elevated commodity prices and sustained higer interest rate should keep the NZD supportive.

Market will be watching rate decisions from the BoE and ECB. Both are universally expected to hold rates steady at 5.25% and 4.00% respectively. The BoE MPC is increasingly moving into a complicated situation with slowing actively on the one hand and intensified price pressures on the other. In regard to the ECB those that were hoping for a signals that rate are going lower will be sorely disappointed. While outlook for actively has declined the move has been moderate while latest news on inflation has done little to ease the European policy makers' minds.

13.00gmt - Fed's Rosengren speaks
18.00gmt - Fed's Geithner speaks

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