ASIA SUMMARY

There were no scheduled economic releases in Asia today but AUD/USD continued to be in play. Yesterday we saw a sharp sell off after the Reserve Bank of Australia decided to leaves rates unchanged. However, NY and London drove the pair to multi-year highs. In today’s session we saw it trade through .8200, but this proved to be a false break as it later traded back into the NY afternoon range around the .8180 area.

In other news, the Chinese Yuan was fixed at 7.7268 against the US dollar, the lowest point since the July 2005 revaluation of the Yuan. It is widely believed that lower USD/Chinese Yuan (higher Yuan) could be positive for the Japanese JPY. JPY crosses did look a bit weak following the Chinese Yuan fix as EUR/JPY broke through the NY lows and USD/JPY tested the 118.50 level.

The wider theme for the market continues to be positioning in front of the Bank of England rate announcement in London and US employment data set to be released on Friday. With some parts of the globe on holiday, there may not be the normal liquidity in the market and this could add to volatility. For those that remember, last year during the Thanksgiving week holiday we saw EUR/USD break the psychological 1.3000 level.

Upcoming Data Release (UK Session):

UK: (4:30am EDT) Month over month industrial production expected .2% vs. expected .1%. (7am EDT) Bank of England announces rates; expected unchanged.

Germany: (6am EDT) Month over month industrial production expected -.5% vs. previous 1.9%.