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The USD is trading somewhat stronger after a better than expected ISM Manufacturing Index in the United States

Wednesday, May 2, 2012 4:00 AM GMT

Good Morning ,

- The USD is trading somewhat stronger after a better than expected ISM
Manufacturing Index in the United States yesterday. China's HSBC PMI was
also firmer than in the previous month and CNY fixed at highest rate before
a high-level US-China meeting tomorrow.

- Stocks: Nikkei +0.67 %, Hang Seng +1.23 %, Shanghai Composite +1.80 %,
Dow Jones +0.50 %, S+P500 +0.57 %

- Japan's liquidity supply dropped in April for the second consecutive month, a
Bank of Japan report showed today.
* Monetary base fell 0.3 percent from a year earlier
* Monetary base dropped 0.2 percent in March, the first decline since August
2008. (Normalization of liquidity injections after the earthquake)

- A jump in Sharp Corp. 's bond risk last month spurred the largest increase in
the cost to insure Japanese corporate debt against default in five months as
the yen near postwar highs weighed on technology company earnings. The Markit
iTraxx Japan index of credit-default swaps for 50 investment-grade borrowers
rose 28 basis points in April to 182.4 basis points, the biggest surge since
November, according to CMA.

- The Bank of Japan is increasing its asset purchase program because it looks
like it will not achieve its inflation target of 1%, even in 2013, Tom Byrne,
senior vice president at Moody's Investors Services said.

- China's manufacturing sector shrank for the sixth month running in April. The
HSBC China Purchasing Managers' Index, geared to smaller firms, improved to
49.3 in April from 48.3 in March, but remained below the threshold of 50 that
divides expansion from contraction. By contrast, the government's official
manufacturing PMI, largely indicative of bigger firms, rose to a 13-month
high of 53.3 in April, figures on Tuesday showed, thanks to stronger output.
The March reading was 53.1.

- The yuan climbed the most in two weeks before talks between U.S. and Chinese
officials in Beijing tomorrow. The fourth round of the U.S.-China strategic
and economic dialogue involves U.S. Treasury Secretary Timothy F. Geithner
and officials led by Chinese Vice Premier Wang Qishan. The People's Bank of
China raised the fixing 0.19 percent to 6.2670 per dollar today, the
strongest level since a peg ended in July 2005 and 0.7 percent stronger than
last week's closing price.

- Federal Reserve Bank of Richmond President Jeffrey Lacker said the central
bank needs to be ready to raise interest rates even if joblessness exceeds
7 percent.

- Federal Reserve Bank of Philadelphia President Charles Plosser said the
central bank must be ready to contain inflation in the long run as it
maintains record monetary stimulus to sustain the recovery.

- Federal Reserve Bank of San Francisco President John Williams said he expects
inflation to remain around the central bank's goal of 2 percent as labor
costs are "muted" given the high unemployment rate.

- Chicago Fed President Charles Evans says he does not see need for strong
accommodation going away until U.S. reaches 4% GDP growth repeatedly for
years.

- Finance officials from China, Japan and South Korea are discussing boosting
cooperation in investing in each other's government bonds to help reduce
market fluctuations, South Korean Deputy Finance Minister Choi Jong-ku said
on Wednesday.

- The leader of France's resurgent, anti-immigrant far right, Marine Le Pen,
said Tuesday she would not endorse either candidate in the country's
presidential runoff, a move likely to deprive President Nicolas Sarkozy of
some sorely needed votes.

- Bank of Canada Governor Mark Carney reiterated that higher interest rates
"may become appropriate" after a speech in Toronto yesterday.

- 1415 US ADP Employment Change Apr
- 1545 US ISM New York
- 1600 US Factory Orders Mar
- 1400 Fed Tarullo
- 1830 Fed Lacker
- 0915 Spain PMI Manufacturing Apr
- 0945 Italy PMI Manufacturing Apr
- 0950 France PMI Manufacturing Apr
- 0955 Germany PMI Manufacturing Apr
- 0955 Germany Unemployment Rate/Change Apr
- 1100 Eurozone Unemployment Rate Mar
- 1030 UK Construction PMI Apr
- 1030 UK Net Consumer Credit Mar
- 1030 UK Lending Sec. on Dwellings Mar
- 1030 UK Mortgage Approvals Mar
- 1030 UK M4 Mar
- 2200 BOE King
- 0915 Switzerland Retail Sales Mar
- 0930 Switzerland PMI Manufacturing Apr
- 0830 Swedbank PMI Apr
- 0900 Norway PMI Apr

(CET)

Have a nice day !

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