Sunday, 18 October 2009
Weekly jobless claims
The dollar and yen recouped sharp overnight selling against the majors in the New York session amid declines in the US equity market. The greenback recovered from a two-month low versus the sterling at 1.4956 toward the 1.4720-level, while pushing the euro off its highs near 1.3582 to beneath the 1.34-handle. By afternoon trading, the Dow Jones is lower by 1.4% and the S&P 500 and Nasdaq both down by over 1.7%. The Fed announced currency swaps with the Bank of England, European Central Bank, Bank of Japan and the Swiss National Bank, thus providing additional liquidity to the global financial markets. The Fed said, “should the need arise, euro, yen, sterling and Swiss francs would be provided to the Federal Reserve via these additional swap arrangements with the relevant central banks”. It also added that “central banks continue to work together and are taking steps as appropriate to foster stability in global financial markets”. With last week’s dismal jobs data out of the way, the economic reports slated for release in this holiday-shortened week are light, consisting of February wholesale inventories, February trade deficit and weekly jobless claims.