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3 Apr 2013
Forex Flash: Major Diverge with GBP and EUR crashing lower - OCBC Bank
FXstreet.com (Barcelona) - Emmanuel Ng of OCBC Bank notes that the majors diverged on Tuesday with the EUR and the GBP plumbing lower across the board while the growth-linked currencies like the AUD, NZD, and CAD marched higher against the greenback.
He adds that both the EUR and GBP were dragged lower somewhat disappointing PMIs out of the EZ periphery and the UK while the AUD received a boost post the RBA meeting. Elsewhere, he adds that Cyprus concluded a EUR10bn bailout with international lenders while the Finance Minister resigned. He feels that markets may remain tentative ahead of the ECB (watch for cautious rhetoric in light of Cyprus), BOE, and the BOJ meetings on Thursday as markets attempt to digest a week of central bank meetings and data releases. Looking down under, he adds that the RBA on Tuesday left its benchmark interest rate unchanged at 3.00% as expected with markets cheering the absence of any additional hints of dovishness relative to the last meeting. In fact, the central bank noted that past monetary policy actions in 2011-2012 “is having an expansionary effect on the economy” with much of the statement reiterating the March release.
He adds that both the EUR and GBP were dragged lower somewhat disappointing PMIs out of the EZ periphery and the UK while the AUD received a boost post the RBA meeting. Elsewhere, he adds that Cyprus concluded a EUR10bn bailout with international lenders while the Finance Minister resigned. He feels that markets may remain tentative ahead of the ECB (watch for cautious rhetoric in light of Cyprus), BOE, and the BOJ meetings on Thursday as markets attempt to digest a week of central bank meetings and data releases. Looking down under, he adds that the RBA on Tuesday left its benchmark interest rate unchanged at 3.00% as expected with markets cheering the absence of any additional hints of dovishness relative to the last meeting. In fact, the central bank noted that past monetary policy actions in 2011-2012 “is having an expansionary effect on the economy” with much of the statement reiterating the March release.