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The risk averse mood come again and the US dollar index (DXY) is around 0.4% stronger

Thursday, April 5, 2012 3:38 AM GMT

Good morning ,

-The risk averse mood come again and the US dollar index (DXY) is around 0.4% stronger. EUR fell from 1.3200 to 1.3107 and stabilized  during the yesterdays  London afternoon.  EUR/USD tested three-week lows around 1.3110 as the ECB repeated that any exit talk was premature at this point. Commentators were pointing out that ECB references to taking "an emerging market stance" to help EU economic growth hinted that Europe may pursue a weaker euro to help stimulate exports.

-ECB  left the Main 7-Day Refi Rate unchanged at 1.00%  as expected and Draghi reiterated the usual ECB positions at the press conference, adding little new color . Mario Draghi stated policy makers are prepared to act if the threat of inflation returns, and in addition the ECB does not currently have any intention to withdraw the current rounds of stimulus anytime soon.

-Poorly attended Spanish debt auction where 2.59 billion of a possible 3.5 billion Euros of bonds

- The impact of the March FOMC minutes reverberated through global markets yesterday  , with the Nikkei plunging and all European indices dropping steadily throughout the session.

-Fed speak yesterday has only reinforced the 'no more stimulus' tone from yesterday's minutes, with hawk Lacker hammering home that growth is picking up and no more support is needed. Yesterday evening, Lockhart said that sustained gains in labor market diminish needs for more easing, which should put an interesting spin on the potential for another big employment gain in Friday's March payrolls report.

-Japan Fin Min Azumi: There are probably differences between Japan and US over forex policy; US views will not affect Japan policy

-According to BOJ, Jan-Mar (3 months) volume in USD/JPY pair rose to $9.8B vs $9.6B for Apr-Dec (9 months)

Japan Diet expected to approve initial FY12 budget of ¥90.3T

-Hong Kong fell over 1.1% after China Premier Wen voiced concerns over the monopoly of the big banks saying that they needed to be broken up.

-Business Council of Australia President Shepherd: Gillard government should not pursue a budget surplus "at any cost"

-A$ and NZD both had a day of gains after declining for the last two days.  Data from the States was more encouraging than that out of Europe and in turn assisting the Australian dollar to remain reasonably composed, albeit under moderate pressure. It traded in a tight range between 1.028 and 1.024 USD as traders welcomed a solid ADP Non-Farm Employment Change at 209,000, a touch higher than estimates

-The markets  for  today  are expected to turn in Easter holiday mode

Have  a  nice  day !

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