Morning forex briefing
The USD is relatively quiet to
start New York after a weaker overnight session. Starting firm and
two sided in early Asia, the USD came under general selling pressure as
hawkish comments from new Japanese monetary officials gave the Yen a boost;
USD/JPY finding willing sellers on a break of the 117.50 area but strong
demand from a US bank kept the rate firm on the dip. Comments from North
Korean officials that they intend to go forward with a nuclear test caused a
brief flurry of USD buying overseas but the USD/JPY pair was unable to trade
higher; exporters and general selling capping the rate at the 117.80 area. CTA-type
accounts are said to have stops building under the 117.35 area with more under
the 117.10 area but support is said to be very firm at the 116.80/117.00 area.
Cable continues to advance making a brief show above the
1.8900 handle in early New York trade after spending a firm overnight session
against the USD. Offers are waiting in the 1.8930 area traders say but
speculation that the BOE will hike rates this Thursday is growing; traders are
unwilling to be outright long the USD according to some desks. EURO is flat
this morning after briefly making a show over the 1.2760 area for a high print
at 1.2767; a new high for the week so far. Traders note that the EURO appears
to be very firm at 1.2680 on dips but is slowly eroding offers above the
1.2750 area suggesting that an upside breakout from the current consolidation
range might be more likely than a breakdown; speculation for an ECB rate hike
on Thursday is nil—