Midday Snapshot & Analysis of Selected Rates

The FX market has been ignoring the continued weakness in US equity prices on Tuesday, with all currencies reversing overnight price action against the USD since the New York open. The Euro, Sterling and Swissy are all moderately bid heading into the London fix, while the Yen has begun to find some offers. This is in sharp contrast to an overnight session which saw significant broad based USD and Yen buying. Meanwhile Eur/Gbp has come under some intense pressure to break below key barriers by 0.9000 into the London fix. Downbeat comments from ECB Provopoulos, weaker Eurozone GDP and better than expected UK industrial production data have all contributed to the acceleration in cross related sales. The Australian Dollar has held up quite well today following the latest 25bp RBA rate cut, with a local article suggesting that the RBA is done, helping to bolster the commodity currency. The DJIA is the biggest equity loser on the day, down some 2.00%, while oil and gold diverge, with oil down some 2.50% and gold up nearly 1.50%