The currency market is still taking its clues from the equity market changes as a mirror of the current financial markets turmoil. The markets eyes were looking for what can be for Citigroup not just these recent days which had a massive selling of the stock but may be since the bankruptcy of Lehman Brothers. The market has looked at the rescue plan of citi as a turning point of the crisis itself even if there are others in need of similar stimulus huge bailing out plans as the markets were looking at the spreading out group across the broad as very big to be allowed to fall with more than 2$ trillions of assets. The market has reacted strongly to the news and pushed the Japanese yen lower across the broad and the greenback in a sign of confidence in the equity markets to take risks again away from the current safe haven stance in the markets which pushed the gold prices recently above 800$, In spite of the current decline of inflation rates around the globe as a negative impact of outlook of the recession which resulted from the financial crisis. God willing, The gold will face serious pressure at these levels right now and in the coming few days by the thanks giving holidays which can calm down the market volumes.
No data today could change this event containing of the current market sentiment. the Germane IFO which has declined to 85.8 could not push the single currency lower and also the decline of US new home sales which came lower than 5 m in October at 4.98m. No serious expected data this week but the market is waiting for next week the US Labor report of November and the ISM services and manufacturing figures of the same month which is expected to keep sinking below 50 in the contracting territory.
Best wishes
FX Consultant Walid Salah El Din E-Mail: snipped-for-privacy@fx-recommends.com