Today FOREX IN REVIEW

Equity indices turned red on Friday as the Eurozone reenters crisis mode and bond yields of weaker sovereigns resumed widening. Spanish 10-year yields are rapidly approaching the 7% threshold as Italian 10-year yields advance towards 6%. The tit-for-tat strategy employed by the ECB to guarantee budget measures in return for bond purchases is seeing mixed reviews as certain bankers see diminishing marginal returns from further purchases. Indices sunk lower led by the Spanish IBEX which slid -0.88% followed by the -0.72% drop in the Italian MIB. The French CAC closed down -0.61%. EURUSD is moving back towards the 1.23 handle, presently trading at 1.2295 as GBPUSD has fallen -0.11% to 1.5672.

The rebuilding efforts and stimulus measures added to rejuvenate the Japanese economy seem to be wearing down as GDP slows to a paltry 0.30% from 1.30% prior. Gains in consumer spending have reversed which raises pressure on the Bank of Japan to provide more stimulus measures to the economy and weaken the yen to promote exports. The yen has weakened slightly this morning as USDJPY pushes higher following the GDP release, adding 0.04% to 78.300. NZDUSD and AUDUSD are both lower, each falling -0.14%. Equity indices are mixed in the overnight session as the Australian ASX leads higher, climbing 0.50% followed by a marginal gain of 0.01% for the Nikkei. The Hang Seng has turned lower, declining -0.05%.

The USDA released its latest crop report on Friday and saw the rally in corn and soybeans fizzle. Corn futures have fallen -0.43% to $805.750 per bushel as soybeans drop -0.52% to $1635.250 per bushel. The energy complex has risen on speculation of further easing from central banks, specifically Japan as the case for the Federal Reserve continues to diminish after the latest jobs figures. WTI crude has risen 0.79% to $93.60 per barrel. Oil continues to rise ahead of the U.S. retail sales figures due later this week which are expected to highlight gains in consumer spending. Equity indices continued their winning streak, with the Dow Jones adding 0.32%. The S&P 500 and Nasdaq were each higher, strengthening 0.22% and 0.07% respectively. The dollar index DXY is slightly weaker, ticking down to 82.548 in the overnight session.
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