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Standard & Poor's cut its credit rating on Spain by two notches

Friday, April 27, 2012 4:30 AM GMT

Good Morning,

-The USD rallied overnight. It stared in New York on S+P's downgrade of Spain and continued with BOJ's asset purchase scheme. EURUSD dropped so far to 1.3157 and USDJPY rallied to 81.45 (from 80.40 low initially after the announcement). EURJPY gave up also a lot of the gains (107.48-106.25 range). SNB Jordan will speak today at SNB's general assembly.

- Stocks: Nikkei -0.73 %, Hang Seng +0.29 %, Shanghai Composite +0.01 %, Dow Jones +0.87 %, S+P500 0.67 %

- Standard & Poor's on Thursday cut its credit rating on Spain by two notches, citing expectations the government finances will deteriorate even more than previously thought as a result of a contracting economy and an ailing banking sector. The ratings agency, which downgraded Spain to BBB-plus from A, also put a negative outlook on the credit and said Spain's situation could deteriorate further unless ambitious measures were taken at European level.

- S&P affirms Ireland's ratings at BBB+/A-2 with an ongoing negative outlook - Federal Reserve Bank of Richmond President Jeffrey Lacker said the U.S. central bank may need to increase the benchmark interest rate by the middle of next year to curb inflation as the economic expansion gains strength.

- The Bank of Japan left its overnight call rate target unchanged at 0-0.1%, while increased the size of the asset purchase scheme by JPY10tn to JPY40th (more than expected). Increases the size of ETF buying to JPY1.6tn, while J-REIT buying size was increased to JPY0.12tn and extended the deadline for asset buying and loan scheme to June 2013. Extended maturities of JGBs being purchased to 3 years. Upgrades assessment of overall economic conditions, saying it has become more evident that Japan's economy is shifting towards pick-up phase.

- The People's Bank of China fixed the yuan's mid-point versus the dollar at 6.2787 on Friday. It was the highest fixing since the landmark revaluation in 2005.

- South Korea's central bank said on Friday it had commenced investment in Chinese yuan government bonds April 24 with its investment limit set at 20 billion yuan ($3.17 billion).

- U.S. Treasury Secretary Timothy F. Geithner called on China to loosen state control of its financial system and to raise the ceiling on deposit interest rates.

- U.K. consumer confidence was unchanged this month and is unlikely to improve after data this week showed the economy slid into its first double-dip recession since 1975, GfK NOP Ltd. said. An index of sentiment held at minus 31 from March. Bloomberg News survey of 20 economists was for an increase to minus 30.

- 14.30 US Employment Cost Index Q1
- 14.30 US GDP Q1 A
- 14.30 US Personal Consumption Q1
- 15.55 US Univ. of Michigan Apr F
- 08.00 Germany GFK Consumer Confidence May
- 08.45 France PPI Mar
- 08.45 France Consumer Spending Mar
- 10.00 Italy Retail Sales Mar
- 12.50 ECB Constancio
- 09.40 BOE Tucker
- 09.00 Switzerland KOF Apr
- 10.00 SNB Jordan
- 09.30 Sweden Retail Sales Mar
- 09.30 Sweden Trade Balance Mar
- 10.00 Norway Retail Sales Mar

(CET)

Have a nice day !

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