Forex Market Updates & Commentary

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• Forex QUICK: USDJPY tries the upside
• Mexico Retail Sales & Overnight Rate Data Stay Unchanged
• Forex Morning Report - May 21
• Bank of Mexico expected to keep rates unchanged at 4.5%
• Forex QUICK: USDCAD has resistance at 1.0718, but stronger data does not help the C$
• Forex QUICK: USDCHF consolidates near the highs.
• Forex QUICK: USDJPY corrects overnight. Slightly bearish in early NY trade.
• Forex QUICK: EURUSD trades against its key technical levels and awaits direction
• Webinar Rebroadcast of Thursday May 20th
• Canada CPI
• Kohn on the wires…
• Euro testing 200 hr MAVG
• UK Public Sector Net Borrowing
• German IFO Business Climate
• German Flash PMI

Forex QUICK: USDJPY tries the upside Posted: 21 May 2010 07:01 AM PDT

Mexico Retail Sales & Overnight Rate Data Stay Unchanged Posted: 21 May 2010 07:01 AM PDT Retail Sales(INEGI):   Survey: 2.0%    Actual: 2.3%    Prior: 2.3%   Overnight Rate:    Survey: 4.50%    Actual: 4.50%    Prior: 4.50%

Forex Morning Report - May 21 Posted: 21 May 2010 06:45 AM PDT

Bank of Mexico expected to keep rates unchanged at 4.5% Posted: 21 May 2010 06:30 AM PDT The decision is due at 10:00 AM. This will be the 9th staight meeting. Courtesy of Bloomberg

Forex QUICK: USDCAD has resistance at 1.0718, but stronger data does not help the C$ Posted: 21 May 2010 06:26 AM PDT

Forex QUICK: USDCHF consolidates near the highs. Posted: 21 May 2010 06:10 AM PDT

Forex QUICK: USDJPY corrects overnight. Slightly bearish in early NY trade. Posted: 21 May 2010 05:34 AM PDT

Forex QUICK: EURUSD trades against its key technical levels and awaits direction Posted: 21 May 2010 05:23 AM PDT

Webinar Rebroadcast of Thursday May 20th Posted: 21 May 2010 05:15 AM PDT Webinar Rebroadcast of Thursday May 20th >>> Click to watch

Canada CPI Posted: 21 May 2010 04:02 AM PDT Core CPI (m/m) - Survey: 0.2%   Actual: 0.3%   Prior: -0.2% CPI (m/m) - Survey: 0.2%   Actual: 0.3%   Prior: 0.0%

Kohn on the wires… Posted: 21 May 2010 03:05 AM PDT Federal Reserve Vice Chairman Donald Kohn has released these statements: Need to be very sure that you have an exit strategy. Very hard to calibrate asset purchases to know how much to buy. Buying longer term or unusual assets has helped to lower rates. Risking unanchoring inflation expectations would be far too costly. The effects of higher levels of reserves are uncertain; high reserves have not had much impact on money or credit. We will be able to raise rates when appropriate. Liquidity facilities have been unwound without a loss to central banks so far. Once policy rate is at or close to zero, expectations for future rates are even more important than unusual. Stable anchored inflation expectations are even more critical at zero; lower bound that usual. Using unconventional policies can drive up inflation expectations, but can also follow inflation down. Very hard to calibrate asset purchases to know how much to buy.

Euro testing 200 hr MAVG Posted: 21 May 2010 01:54 AM PDT After reaching a session high of 1.2671, the highest level since May 13th, the EUR/USD pair has traded continually lower and is now testing the 200 hr moving average at 1.2472. As shown below, the last two hourly candlesticks tested the line but could not break through; a close below may be a bearish signal for the pair in which case the next downside target would be the 61.8% line on the move from the low of May 20 to today’s high, at 1.2439. The next topside target is currently the 38.2% line at 1.2528 and further is the 23.6% retracement at 1.2582.

UK Public Sector Net Borrowing Posted: 21 May 2010 01:33 AM PDT Public Sector Net Borrowing - Survey: 11.1B   Actual: 10.0B   Prior: 23.5B Prelim Bus Investment (q/q) - Survey: -0.5%   Actual: 6.0%   Prior: -4.3% Prelim Mortgage Approvals - Survey: 54K   Actual: 47K   Prior: 49K Prelim M4 Money Supply - Survey: 0.3%   Actual: 0.0%   Prior: 0.2%

German IFO Business Climate Posted: 21 May 2010 01:04 AM PDT The euro traded lower, but had a quick recovery after German business climate came in slightly lower at 101.5 versus a forecast of 101.9 and prior reading of 101.6. Additionally, the Eurozone released the following better than expected data: Current Account - Survey: -2.7B   Actual: 1.7B   Prior: -3.9B Flash Man PMI - Survey: 57.6   Actual: 55.9   Prior: 57.6 Flash Services PMI - Survey: 55.5   Actual: 56.0   Prior: 55.6

German Flash PMI Posted: 21 May 2010 12:31 AM PDT The EUR traded slightly lower after Germany’s Flash PMI for April came in slighly worse than expected Flash Manufacturing PMI - Survey: 61.6   Actual: 58.3   Prior: 61.5 Flash Services PMI - Survey: 55.6   Actual: 53.7   Prior: 55.2

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