Forex Special - Japanese election failure threatens Kan's debt reduction initiatives; yen weakness leads modest dollar rally in pre-lunch asia Chinese trade surplus stronger than expected Euro skeptics abound with inevitable suggestions for Euro Zone de-coupling: Capital Economics weighs in the EUR/USD met heavy traffic above 1.2700 friday; perhaps it's time for a breather with short COT positions cut back South Korean central bank growth forecasts may lead to further future tightening after last week's lead July Tankan report - highest level in 30 months Japanese June Domestic CGPI - 0.4% MoM Chinese June Property Prices drop - 0.1% May sees first Australian Housing Finance rise since September 09 UK Telegraph's AEP on the two-tier problems of the EMU An expectant market waiting for real action was disappointed as the eyes were on Spain and The Netherlands early on. Not even the strong Chinese trade surplus could insert energy into the risk trades. The Japanese government's thrashing in the upper house did however engender some USD buying in the JPY and EUR although ranges were narrow; bourses were similarly subdued after an realy Nikkei soft opening to revrt to small positives; ditto GOLD and OIL. EUR/USD trades 1.2606, range 1.2588/1.2647 ; EUR/JPY 112.32 after 111.98/112.40 CABLE sold down to 1.5003 as EUR/GBP looked to test 0.8400 early on; ranges 1.5003/1.5078 and EUR/GBP 83.73/96 USD/JPY ranged 88.59/89.15 currently 89.09, probably looking to test 89.25 corporate offers in the near few hours AUD/USD range was 87.33/76 and the AUD/JPY 77.56/78.12 with AUD cross buying soon after lunch.
