FOREX IN REVIEW

There was a modest risk-off rally in EURUSD yesterday as the Slovakian Prime Minister's comments coupled with the no official word from Spain saw a 70 pip move lower before recovering modestly to 1.2519. Since exploring options including an IMF loan, Spain has seen 3 regional governments come to the government short-term funding as the government tries to avoid a bailout. European stocks faced losses following the Italian bond auction as yields moved higher on Italian and Spanish debt and the auction failed to reach the target. Equity indices closed lower across the board, led to the downside by the -1.64% loss in the German DAX. The Spanish IBEX and Euro Stoxx 50 were notably weaker, falling -1.52% and -1.25% respectively. Today will see CPI data and employment data for the entire Eurozone.

Asian stocks are heading for the first monthly loss since May as deflation persists in Japan and the European Monetary Union comes under pressure from unresolved debt woes. Declines in Japanese industrial production and consumer prices are stacking problems against the Bank of Japan's fight for inflation and growth. USDJPY has fallen -.20% to 78.470 as other Asian bell weather currencies strengthen as well. AUDUSD is up 0.08% while NZDUSD rises 0.15%. Meanwhile, Chinese stocks are headed for one of the worst losing streaks in the last 8-years as slowing growth impacts equities. The overnight session has seen continued equity weakness, as poor data impairs the Nikkei, falling -1.11% in trading. The Hang Seng and Australian ASX are also moving lower, sliding -0.45% and -0.17% respectively.

As trader's look ahead to today's speech by Fed Chairman Ben Bernanke, nothing new is expected as far as announcements regarding the American economy. As the next FOMC rate decision and meeting rapidly approaches, differing views from regional Fed Presidents has muddled the view amongst economists and analysts. Jobless claims came in-line with the results from the prior week as consumer confidence plunged to lows. Equity indices carried over the weakness from Europe with the Nasdaq crumbling -1.05% followed by a -0.81% slide in the Dow Jones and -0.78% fall in the S&P 500. WTI crude oil continues to trend lower as the hurricane fears proved overblown, falling below the $95 handle to $94.71 per barrel. Factory orders are due later before Ben Bernanke's speech.

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