Monti Plays Coy With Euro
The euro steadily recovered in US trading after some cryptic comments from Italian PM Monti. The kiwi rose for the sixth straight day and was the best performer while neighbouring AUD was the laggard. The calendar features Australian business confidence and Japanese machine orders. Both of the Pre-EURUSD trades remain in progress.
Italian 10-year yields climbed 30 basis points higher and stocks fell 2.2% as political wrangling continues and Berlusconi threatens to return. Technocrat PM Monti recently said he would step down as soon as February but today said he is not considering running at this time. The FT also reported he is being courted by centrists and considering running for election.
The euro dropped to 1.2886 at the weekly open but that was the low print of the day. The euro climbed steadily higher in US trading and finished the day at 1.2941.
Cable was also active in US trading as it charged up to 1.6097 before drifting back to 1.6078. Otherwise, market moves were relatively tame.
Asia-Pacific traders will be searching for a focus due to the light calendar. Up first, at 0030 GMT, NAB reports on business confidence. The prior reading was -1.
At 0600 GMT, the focus shifts to the struggling Japanese economy, which yesterdays GDP data showed has fallen into a technical recession. Preliminary machine tool orders are likely to continue contracting after a 6.7% y/y decline in October.
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