Daily Forex Snapshots

Asian Session – BoJ injects $14Bn into money markets as Asian stocks wake up to the global crisis

September 16, 2008 10:30 AM CEST

G10 Advancers and Decliners vs USD

	JPY	1.82
	CHF	0.80
	EUR	0.29
	DKK	0.25
	GBP	0.16
	SEK	0.02
	NOK	-0.19
	CAD	-0.39
	NZD	-1.39
	AUD	-2.46

Global Indexes

Current Level

% Change

Nikkei 225 Index	11,609.72	- 4.95
Hang Seng Index	18,480.57	- 4.50
Shanghai Index	1,986.64	- 4.47
FTSE 100 Index	5,128.10	- 1.46
CAC 40 Index	4,119.44	- 1.18
DAX Index	5,979.96	- 1.38
DJIA futures	10,937.00	- 0.20

World Markets

Current Level

% Change

Gold	776.55	- 1.28
Silver	10.77	- 3.19
VIX	31.70	+ 23.53
Crude wti	92.92	- 2.91
USD Index	78.47	- 0.55

Todays Calender

Estimates

Country / GMT

CPI (Aug Final)	-0.2%,+3.8	(+3.8%)p	EZ / 9.00
Core CPI (Aug)	+1.7%	+1.7%	EZ / 9.00
Consumer Price Index (Aug)	-0.1%,+5.5	0.8%.+5.6	US / 12.30
Core Consumer Price Index (Aug)	0.2%,+2.6	0.3%,+2.5	US / 12.30
Net Foreign Purchases Of US Securities (Jul)	+$40.0bn	+$51.1bn	US / 13.00
NAHB Housing Market Index (Sep)	17	16	US / 17.00
Fed Interest Rate Announcement	2.00%	2.00%	US / 18.15

Currency Tech

AUDUSD
R 3: 0.8300
R 2: 0.8263
R 1: 0.8077
CURRENT: 0.7871
S 1: 0.7675
S 2: 0.7616
S 3: 0.7560

EURJPY
R 3: 153.57
R 2: 152.92
R 1: 149.49
CURRENT: 148.01
S 1: 147.54
S 2: 146.21
S 3: 145.75

USDSGD
R 3: 1.4542
R 2: 1.4478
R 1: 1.4394
CURRENT: 1.4348
S 1: 1.4234
S 2: 1.4142
S 3: 1.4116

Market Brief

The Usd was mixed in Asian Session, as the residual effect of yesterday’s shocker played in participant’s minds. The EurUsd saw choppy trading between 1.4176 and 1.4324, while the Jpy continued to gain from the market turbulence, with the UsdJpy falling from 106.04 to 103.68. High yielders & carry trades came under pressure, as the market wanted nothing to do with the extra risk in this uncertainty environment. The AudUsd fell from 0.8092 to 0.7859 and the GbpJpy dropped from 189.86 to 185.75. As it would be expected, this weekend’s event has a huge effect on EM assets classes.

Risk aversion is at a record high, with the Yen and Swiss Franc gaining, as investors seek their “safe haven” attributes. Yen is rising 250pips (4% since Friday’s close around 108.00) against the dollar to 103.90 in the morning session. U.S financial woes are affecting the Asian markets gravely in opening, as most markets were closed for holiday yesterday, when Lehman Brothers, Merrill Lynch and AIG news played out.

Yesterday’s Wall Street action was one directional, with S&P leading the losers down -4.71%. Asian equities have followed, with the Nikkei down 5%, to a three-year low, as investors dumped shares following WS meltdown. The Hang Seng dropped close to 6% and Shanghai composite down 4.5% as the People’s Bank of China cut the 1 yr benchmark lending rate 27bp basis points (first cut since Feb02). Since roughly June, Chinese officials have been shifting their focus away from controlling inflation towards supporting growth.

The critical event of the day will be the FOMC meeting and rate decision today at 18:15 GMT. An interesting figure to note is that on Friday’s close 12% of market professionals believed the FOMC would cut rates, which number is just below 70%. Despite the massive turmoil we are still expecting the Fed to hold rate steady at 2.00%.

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