Intraday Market Thoughts

EUR Does 1.33 on IFO, US Home Sales Next

by Ashraf Laidi
Dec 19, 2012 13:13

German Ifo rose; MPC 8-1 against QE; EURJPY hit 2012 high. Market turns to real estate data and later to NZ GDP. 16 new trades were added in last night’s Premium Insights. 1 of 2 Oil trades hit all targets

USD greenback is mixed in the ongoing session. EUR, GBP and CHF are stronger but AUD and NZD weakened. European equities are gaining about 0.5%.

EURUSD hits 1.33 on further run-up post Greece Upgrade by S&P and after the German Ifo Business climate bested expectations. It rose in December to 102.4 from previous 101.4, the expectations sub index rose to 97.9 and the current assessment fell to 107.1.

The MPC 9-0 to keep rates steady and 8-1 against further QE. David Miles was the only member who voted for GBP 25 bln in additional asset purchases. The MPC agreed with the treasuries decision to use coupons from BOE gilt portfolio to reduce T-bill issuance in 2012-13. CBI reported sales fell in December to 19 from previous 33. GBPUSD trades near session high around 1.6295 with an important weekly resistance just above.

JPY selling continued across the board during the London session. USDJPY rose to 84.55 and EURJPY hit fresh 2012 highs at 112.24.

The US session begins at 8:30 am ET with housing starts that are expected to decline in November to 0.87M from previous 0.89M while building permits are seen higher at 0.88M from 0.87M.

NZD traders are awaiting Q3 GDP due at 4:45 pm ET that is forecasted to slow to 0.4% from prior 0.6% q/q and to 2.5% from 2.6% y/y. The kiwi lost a large part of recent gains against the rest of the majors so a disappointing result would imply further downside.

Act Exp Prev GMT
Business Climate
102.4 101.9 101.4 Dec 19 9:00
Building Permits
0.88M 0.87M Dec 19 13:30
Housing Starts
0.87M 0.89M Dec 19 13:30
GDP (q/q)
0.4% 0.6% Dec 19 21:45

Latest IMTs