Forex Blog

April 3, 2012

Aussie Still Exposed to Relative Underperformance Following Dovish RBA

Filed under: Forex News — Tags: , , , , , , , , , , — admin @ 7:27 am

By Joel Kruger, Technical Strategist for DailyFX.com

  • RBA leaves policy on hold at 4.25% as expected
  • Australian Dollar under relative pressure on dovish comments
  • Board suggests potential for rate cut in May
  • EUR/USD still showing room for a break to fresh 2012 highs

Overall, it has been an uninspired start to the week, with Monday’s price action failing to offer any hints into direction and Tuesday showing more of the same. The key event on the day thus far has been the RBA rate decision, with the Australian central bank leaving rates on hold at 4.25% as was widely anticipated. The higher yielding Australian Dollar has however come under some relative pressure in recent days, and could continue to underperform as markets start to price in a more accommodative Aussie central bank. The realities of a slower China and potential spread of the Eurozone crisis are being more widely adopted by market participants and we see this is the primary driver of Aussie weakness going forward.

The Australian Dollar has been a major beneficiary of risk on flows in recent years, with the currency tracking to fresh post float record highs in 2011 just over 1.1000. But from here there is evidence of the formation of a major technical top which exposes deeper setbacks below parity over the medium-term. Cross rates like EUR/AUD also stand to gain a great deal from the structural reversal in the Australian Dollar, with this market looking to carve a major base by 1.2000 after falling off a cliff in 2008 from levels above 2.1000. The general takeaway from the latest RBA policy decision is a central bank that is tilting more to the dovish side after hinting at the possibility of an imminent rate cut in May should inflation figures continue to show signs of softening. The Board has highlighted that the pace of output growth is somewhat lower than earlier estimated and that adjustments may therefore need to be made.

Elsewhere, we are keeping a close watch on the moves in EUR/USD, with the market still very much locked in a tight consolidation. While our core bias in this market is bearish, for now, it seems as though the shorter-term risks are tilted to the upside as the correction in 2012 continues to play out. The technical picture is showing a bullish triangle formation on the hourly/daily chart which now opens the door for a sustained break above 1.3400 and towards the 2012 highs by 1.3490 further up. At this point, only a break and close back below 1.3250 would negate outlook and alleviate immediate topside pressures. Any gains beyond 1.3500 are expected to be met with solid offers by the 200-Day SMA just shy of 1.3600. Finally, as a side note, one other cross rate worth watching this week is EUR/CHF, with the market dangerously close to testing the highly touted SNB 1.2000 floor. A break below this barrier could spark some fresh volatility in the cross.

March 30, 2012

Dollar Danger is to Trade Higher

Filed under: OANDA News — Tags: , , , , , , , , , , — admin @ 10:27 am

Bernanke’s remarks this week on the US job market are being considered his most dovish stance to date. The reserve currency of choice chose to underperform, squeezing weaker shorts and managing to print a new medium EUR term high. Unless the market gets a sense that the Fed is contemplating another round of QE, then the dollar is not expected to weaken significantly from here. By stating that the problems troubling the job markets are ‘cyclical and not structural’ implies that policy stimulus can be effective at reducing the labor market slack. If however, the problems facing the US were structural in nature, then accommodative monetary policy would not necessarily be effective. Now that quarter and month end rebalancing has been completed, the market can get back to trading fundamentals. This week’s slew of global PMI’s could be setting the tone for the dollar a considerable period of time.

Below are some other highlights of the week:


Americas

  • Fed: Bernanke’s comments on employment at the beginning of the week are being considered his most dovish to date. The market focused on his statement that improvements in the job market will require faster economic growth, “a process that can be supported by continued accommodative policies” to push the dollar to underperform outright. It’s this phrase that is very much open to interpretation. It could mean either a delay in their exit strategy of current policy or hiking the Fed’s fund target. The FI dealers could argue that policy makers are “not comfortable with the twist’s expiration at the end of June,” heightening speculation of introducing QE3. PIMCO says the Fed may hint at QE3 in April.
  • USD: February pending home sales slip a small -0.5% vs. a +1% gain expected. Realtors point to “an elevated level of contract offers so far this year” to suggest existing home sales could be best performance in five-years. Still, other February data (starts and sales) also disappointed; housing recovery remains slow and uneven.
  • USD: Dallas Fed manufacturing index dropped to 10.8 from 17.8 in February. Readings on demand fall sharply, as new orders index drops to -0.3% from 5.8 and growth rate of orders index contracts to -0.8 from 6.6. Area factories also report rising prices.
  • USD: US House prices continue to tumble according to S&P’s Case-Shiller home-price indexes. US home prices dropped in January, with average prices dropping back to 2003 levels. The index dropped-0.8% from a month earlier, while on a year over year prices fell -3.9% in the 10 major markets. The 20-city index dropped -3.8%.
  • Fed: Dudley’s (NY Fed) testimony, before the House Financial subcommittee on domestic monetary policy, informed leaders that the reduced rate to charge for dollar SWAPS has helped the availability of funds to consumers and firms as the European Union works through their challenges. He also stated that the Fed has not made any decisions on further interventions and that the SWAP lines probably enhance the dollar as a reserve currency.
  • USD: March’s Consumer confidence came in close to expectations as US consumers remain confident about the economy and labor markets, but inflation worries jumped this month. The index fell to 70.2 on the month after jumping more than ten points in February to a revised 71.6, first reported as 70.8. The present situation index rose to 51 from a revised 46.4.
  • USD: The Richmond Fed manufacturing and service sector surveys made for a sharp contrast in March, with the manufacturing composite index plunging from +20 to +7 and the services revenue index jumping from +6 to +26. The manufacturing headline was its weakest in three-months, whiles services revenue growth hit its fastest rate in five years.
  • Fed: Bernanke said that the Great Depression was considerably more severe than the recent recession:-The Fed’s forceful policy response to the recent financial crisis and recession likely averted much worse outcomes.
  • USD: Crude-oil futures have been hit by a surprise build in US oil inventories and the renewed potential for a strategic oil reserve release. Crude stocks rose by +7.1m barrels last week. The prospect of a release of strategic oil reserves from the US and some European nations have also being pressurizing oil.
  • USD: Manufacturers orders for durable goods last month rose by +2.2% to a seasonally adjusted $211.7b. The market had been expecting a +3% rise. Orders dipped in January by a revised -3.6% from -3.7%. A key barometer for capital spending, orders for non-defense capital goods ex-aircraft climbed by +1.2% suggesting a degree of confidence in the recovery.
  • USD: US weekly jobless claims fell -5k to +359k last week. However, there was a large revision to the previous week making a few head turns. Annual adjustments to seasonal factors caused the prior week to report a higher number (+364k vs. +348k). Perhaps US job market is not as hot as we had thought?
  • USD: In the final estimate of the US economy this week the commerce department reported that the US economy expanded at its fastest rate in 18-months in Q4 of 2011. Despite being the strongest gain since Q2 in 2008, the market had been expecting a +3.2% growth rate.
  • USD: Benign core-PCE (+0.1% vs. +0.2%) is an excuse for Fed to concentrate on employment
  • US spending shot up by +0.8% last month, outstripping income growth of +0.2%. February’s numbers extend on January’s performance where revisions show that income rose +0.2% (+0.3%) and spending rose +0.4% (+0.2%).
  • CAD: Canadian GDP expanded +0.1% in January as manufacturing output increased for the fifth consecutive month. Analysts had expected manufacturing to be a drag on growth as factory sales data for the month had shown a sharp drop in volumes. Year-onyear GDP growth slowed to +1.7% from +1.9%.

Yen to bear the weight of PMIs

Filed under: OANDA News — Tags: , , , , , , , , — admin @ 10:26 am

The immediate concern is that the slew of PMIs out early next week will suggest that the global recovery is stumbling, including in the US. Asia has the potential to trade on the weak side in this environment. There will be a risk of some unwinding of the recent rise in Asian yields if both the Chinese and US PMIs disappoint. By Monday, we could be trading in another risk aversion trading environment. The dollar has ended the week on firmer footing, a sign that month-end rebalancing and positioning has been completed , allowing investors to go back to trading fundamentals, which remain dollar positive. With the BoJ meeting twice in April, a percentage of the market remains bearish on Japanese yields as they price in policy easing at the second of these meetings.

Below are some other highlights of the week:


Asia

  • JPY: BoJ Governor Shirakawa warned of the risk of keeping interest rates low for too long. He said, “If low interest rates induce investment projects that are only profitable at such interest-rate levels, this could have an adverse impact on productivity and growth potential of the economy by making resource allocation inefficient.”
  • NZD: Kiwi trade balance was back in surplus of $161 m in February, following a revised deficit of $159m in January. Exports fell -6.9%, y/y, to $3.59b from a revised $3.73b while imports dropped -6.6%, y/y, to $3.43b from a revised $3.89b in February.
  • CNY: Chinese industrial companies had their first January-February profit decline since 2009 as slowing exports and a government campaign to cool property prices damped earnings. Year to date, industrial profits declined by -5.2%, y/y, in February, compared with a +25.4%, y/y, gain in January.
  • KRW: Korea’s consumer confidence rose to 101 in March from 100 in February, the highest level in four-months.
  • PHP: The Philippines’ imports fell -3.2%, y/y, in January following a revised -6.4%, y/y, decline in December.
  • KRW: Korea’s manufacturing confidence index rose to 85 in April from 84 for March, the highest level in six months. The non-manufacturing index for April advanced to 82 from 80 in March.
  • THB: Thai exports unexpectedly rose +0.9%, y/y, in February, stronger than the consensus forecast for a -5% fall and has helped push the trade balance back into a $530m surplus from a $1.1b deficit in January.
  • BRL: The Brazilian finance ministry has denied they were studying expanding the IOF tax to all FX transactions.
  • CNY: A Chinese state-owned company reportedly has defaulted on commercial paper worth 400 million yuan ($63.4m) maturing on April 15 as they are expected to miss their loan payments. Expect the government to likely intervene ahead of a contagion event.
  • JPY: Japan’s retail sales rose more than forecasted for February, up by +3.5%, y/y, after a +1.9% increase in January, the biggest advance in nearly two-years and a third straight monthly rise.
  • CNY: China has approved a pilot project to allow residents of Wenzhou to invest privately overseas as a test bed for future liberalization of the capital account.
  • KRW: South Korea recorded a current account surplus of +$639m in February following a revised -$969mn deficit in January.
  • NZD: New Zealand’s NBNZ business confidence index rose to 33.8 in March, up from 28 in February. Also, the NBNZ activity outlook index increased to 38.8 from 31.2 in February.
  • AUD: Aussies ABS quarterly job vacancies rose by +0.7% in February compared with a revised fall of -3.4% in November.
  • JPY: Japan’s IP unexpectedly fell -1.2%, m/m, in February after a +1.9% gain in January. Inflation, on the other hand, surprised to the upside with headline CPI rising +0.3%, y/y, while core-CPI (ex-food and energy) fell -0.6%. The market continues to sell JPY on dollar pull backs.
  • AUD: Aussie new home sales recorded a modest gain of +3%, m/m, in February following large drops in the previous two months.
  • NZD: Kiwi building permits fell -6.7%, m/m, in February after an +8.3% rise in January.

March 27, 2012

US 2-Years Better Bid at Auction

Filed under: OANDA News — Tags: , , , , , , , , , , , , — admin @ 11:55 am

The markets interpretation of how dovish Bernanke’s employment speech was yesterday provided for a strong 2-year US auction this afternoon. Despite the US Treasury selling 2-year notes at the highest yield since last July, the +0.34% yield was below the market rate at time of sale. With consumer confidence dipping and home prices falling earlier this morning was always going to provide a better bid for product at time of auction. Today’s Treasury sale is the first of three offerings this week totaling $99-billion in 2′s, 5′s and 7-year notes.

Direct bidders took +21.4% of the +$35-billion sale, matching the highest proportion in almost two years. Indirect bidders took down +34.3%, above the +33.1% recent average. The bid-to-cover ratio came in at 3.69. Up until now, investors have been wavering about whether policy makers were going to provide more stimulus for the US economy. Bernanke’s cautious comments has since revived expectations, again boosting the appeal of US treasuries.

Earlier this morning, the Fed bought Treasuries due from February 2036 to May 2041 under Operation twist. Under this plan to sell short dated notes by purchasing longer dated securities, policy makers hope to push longer dated yields lower for consumers and business to facilitate economic recovery.

Economic Indicators“>

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EUR Positions Remain Offside

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EUR Positions Remain Offside

Filed under: OANDA News — Tags: , , , , , , , , , — admin @ 4:40 am

Helicopter Ben’s remarks yesterday morning on the US job market are being considered his most dovish stance to date. The dollar for most of this month, so much in demand, continues to underperform, triggering stop losses outright against its major trading pairs. Currently, the EUR trades north of the psychological 1.33 level, eyeing 1.34 where option barrier offers are now looking to try to slow this upside advance. This squeeze is making the weaker EUR bears rather nervous.

Bernanke’s comments are being used as a ‘cure all’ for many investors grappling with uncertainty over the state of the global economy. Agreeing that most of the success in the job market was a function of declining layoffs rather than increased hiring has helped to keep alive the quantitative easing sentiment as well as ensuring that the Fed would keep a heavy foot on monetary policy. What did Ben mean by “continued accommodation” yesterday? It’s this phrase that is very much open to interpretation. It could mean either a delay in their exit strategy of current policy or hiking the Fed’s fund target. The FI dealers could argue that policy makers are not comfortable with the “twist’s” expiration at the end of June, heightening speculation of introducing QE3. Bernanke is playing into the majority of investors ‘who believe in reverting into the low yield environment by an ever growing series of QE’s. Many investors are embracing his remarks literally, allowing themselves to boost their risk tolerance and push global equities higher.

Adding further support to EUR sentiment this morning, data revealed that French consumer sentiment rose sharply and unexpectedly (87 vs. 82) in March to a level not seen in twelve-month. Rising consumer confidence is always good news. However, prospects for future spending remain relatively weak the world over, as purchasing powers remain undermined by uncertainties about future activity and weak labor markets. Both the Spanish and Italian debt auctions were themselves well received, and managed to push yields lower. Is it only a matter of time that the ‘band aid for a bullet wound’ starts to bleed again? Spain is very much in the capital markets firing line and the natural contagion reaction would suggest that Italy in only steps behind. For now its easy for the market to focus on positioning.

Mar 27 Positions

As the above diagram reveals, investors continue to trade overweight short EURs, a position that was added too once the psychological 1.33 barrier was penetrated yesterday. The market had not anticipated Bernanke to err so heavily on the side of dovishness. Ever since, bearish investors have been adding to their shorts, more in hope believing that this is as much of a squeeze we can expect. However, positioning, fundamentals and technical analysis would suggest that there is at least one good EUR pop left in this market before the dollar finds its friends again. For the weak bears, they can only hope that the EUR is close to its medium term top.

Forex heatmap

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Dovish Bernanke Punishes the Dollar

March 23, 2012

EUR Dictated by Option Demands

Filed under: OANDA News — Tags: , , , , , , , , , , , , — admin @ 4:35 am

The EUR bears certainly got the short end of the stick after the weaker global PMI releases. In a market where you would expect the single currency to underperform more so, has seen the rumored bottom feeders from Russia support and buy in size. Their presence, or who ever, has put off any technical attempts for the market to trigger stop losses below 1.3150 with conviction yesterday. This morning, the EUR continues to extend it gains, tackling 1.33, as more stops, on the top side now, get taken out in European trade. With China using the CNY fix and rumors of an imminent RRR cut in the overnight session had many changing their trading tact midstream.

Vanilla currency options are strangling some of the G7 currency ranges. Sovereign and semiofficial supply will look to slow the EUR’s upside. Elevation does not suite the single currency as it remains vulnerable in lofty territory. Bearish action over the past two sessions has seen the technical charts work off an overbought bias. Aggressive buyers are ever present on dips and will be armed with their tight stops. Fast money interest in EUR/JPY’s topside has being one of the biggest supports in this mornings European action. Protection of the 1.33 barrier has capped the outright sessions topside for now, allowing the currency to skulk amid its initial failure. A break above the highs will generate a fresher bullish follow through for the chartist in us.

Increasing chatter is putting further emphasis on month-end requirements and what we are supposed to expect. The meeting of quarter and month-end action tends to muddy the FX market and destroy many traders playbook and this one is no different. The recent US asset classes performance is expected to see US pension funds have a significant rebalancing need in month and quarter-end, especially given the size of the equity market rally and fixed income sell off this quarter. Logic and history would also mean significant month-end forex flow. Support for treasury’s and selling of equities would only further “muddy the waters in determining whether we have moved into a new FX paradigm whereby risk sentiment is on the up.”

For now, we have the protection of options dominating intraday movements just like EUR’s feeble 1.33 attempt this morning. We still have time, North America could reload and give it a go ahead of its new home sales data release. Thus far, February housing numbers have generally been moderately weaker than expected, with the notable exception of building permits.

Forex heatmap

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March 20, 2012

Australian Dollar’s Glow is Fading; Expect Undepeformance Going Forward

Filed under: Forex News — Tags: , , , , , , , , , , , , — admin @ 7:48 am

By Joel Kruger, Technical Strategist for DailyFX.com

  • Aussie continues to show signs of underperformance
  • RBA Minutes fairly positive but currency still offered
  • Lower China equities factor into the price action
  • Downbeat comments from BHP contribute to additional declines
  • Fed speak later in the day should factor into price action
  • US equities still look vulnerable at current levels

The Australian Dollar has been one of the most interesting currencies to watch over the past few sessions, with the risk correlated, higher yielding market unable to extend gains despite a healthy appetite for risk. We think the price action is actually quite telling and could be warning of a near-term pullback in risk sentiment given how well this currency has served as a proxy for risk in recent years. Despite a fairly positive RBA Minutes overnight, the currency is once again showing relative underperformance, with the market likely weighed down by a disappointing performance in Chinese equities.

Also adding to weakness in the Australian Dollar have been some downbeat comments from the world’s biggest miner, with BHP warning that iron ore demand from China will likely flatten out . We still contend that a third phase of the global recession is now starting to materialize in China, and this will weigh heavily on Australia, other commodity bloc economies and emerging markets going forward. We therefore recommend keeping a close eye on cross rates like EUR/AUD, which has been beaten down in recent years and could be on the verge of a major structural shift and bullish reversal. Look for a push back above 1.2620 to confirm this outlook and likely accelerate gains back above 1.3000.

Moving on, the economic calendar on Tuesday is rather busy, but most of the attention will probably be placed on Fed speak later in the day when Fed Chair Bernanke and Fed Kocherlakota offer added insights into the future direction of monetary policy. US equity markets are also worth watching and we continue to contend that these markets are well overdone at current levels and subject to a significant bearish reversal. Look for a break and close below Monday’s lows to confirm our bias.

March 8, 2012

EUR Debt Relief Belief

Filed under: OANDA News — Tags: , , , , , , , , , , , , , — admin @ 4:17 am

This is the market move that investors should have been treated to earlier in the week, rather than a painful consolidation of FX pricing. There is a lot in play today. Investors will be treated to a bit of posturing, much rhetoric and little substance from three Central banks rate decision announcements. Some sweat and tears have already been spilled as the worlds awaits the outcome of Greece’s debt-swap deal deadline later today (details tomorrow) and finally when all is said and done, markets will begin guesstimating tomorrows NFP and try to position accordingly after today’s claims release.

Investors are becoming increasingly optimistic that Greece’s debt-swap deal will go through, clearing the way for the country to receive the second tranche of its bailout funds. Thus far, it has been noted that +60% of investors have indicated that they will participate in the PSI, and helping “pave the way for the PSI to continue, even if the collective action clauses have to be triggered.” The deadline is 3pm this afternoon, with Euro-finance ministers expected to decide tomorrow whether to release the +EUR130b in bailout funds.

The ECB (+1%), BoE (+0.5%) and BoC (+1%) are likely to keep policy on hold later this morning. While still basking in the glow of the strong uptake to its most recent LTRO program, today’s ECB meeting is unlikely to see any major announcements. However, Draghi may provide some indication on the prospects for more LTRO operations going forward. With the BoE set to complete its latest +GBP50b in asset purchases in May, recent rhetoric from MPC members indicate that they judge the current policy as appropriate. The ongoing improvement and strength of UK data with support that. In Canada, Governor Carney will not want to be upsetting anyone. Market consensus has the BoC standing pat with a slight chance that the decision might also feature a small growth outlook upgrade. No matter what happens, the loonie should trade in a tight range today ahead of US and Canadian payroll data tomorrow.

It seems that you cannot keep Bernanke away from the printing press for very long. Reports suggest that the Fed is considering a number of QE approaches, including operation twist “Mark II,” a sterilized bond purchase program. This would see the Fed print money to buy long-term bonds, but absorb the increase in liquidity through new open market tools. All of this will and is obviously weighing on the big dollar.

Just when you think when you have caught your breath, the markets focus will quickly turn to tomorrows fundamental releases. Yesterday’s slightly better than expected ADP report will be measured up against this mornings jobless claims release. Expectations are looking for a weekly decrease to +345k from +351k. Data in line would suggest an extension of the current trend and obviously a precursor to tomorrows NFP release (+208k and +8.3%).

Proof of perseverance in the overnight session has been the AUD. The currency rallying indicates somewhat the markets depth of relief belief. Data down-under indicates that employment fell -15.4k last month, much weaker than the consensus forecast for +5k. Digging deeper, the loss was seen mostly in part-time employment as full time employment was flat on the month. Analysts note that the unemployment rate rose slightly, but “remained in the +5.0-5.2% trajectory and the rebound in hours worked more than offset the losses in part-time employment.”

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March 6, 2012

RBA Leaves Rates on Hold As Expected; Risk Off Trade Carries into Tuesday

Filed under: Forex News — Tags: , , , , , , , , , , , , , — admin @ 7:51 am

By Joel Kruger, Technical Strategist for DailyFX.com

  • RBA leaves rates on hold at 4.25% as expected
  • Accompanying language slightly more downbeat than expected
  • China growth forecast downgrade and Greek PSI outcome weighing
  • Kiwi is the hardest currency on the day thus far
  • Investors looking ahead to RBNZ, BOE, ECB and NFPs

The first big event risk of the week is now out of the way, with the RBA leaving rates on hold at 4.25% as was widely expected. The accompanying central bank statement offered nothing surprising but did show a slightly more downbeat slant than perhaps expected, after citing concerns over global growth and maintaining an easing bias. The Australian Dollar has been sold since the rate decision and the less upbeat tone along with broader risk off themes have been driving the relative weakness. China’s lowered growth forecasts have not helped matters and this already follows some softer local PMI readings.

The New Zealand Dollar however has been the standout underperformer on the day thus far, with the market accelerating to the downside following a break of some key support by 0.8250 in the previous day. Elsewhere, ongoing concerns over the outcome of the Greek PSI talks will likely provide an added layer of uncertainty in the markets and developments on this front should be watched closely. Investors will also continue to look ahead to the risk in the latter half of the week associated with the RBNZ, BOE, and ECB rate decisions, along with US NFPs.

Where is the EUR demand?

Filed under: OANDA News — Tags: , , , , , , , , , — admin @ 4:19 am

Everything is fine in the world if you are holding mostly “bear” dominated positions. With global equities seeing red for the third-consecutive day, its longest losing stretch in two-months and market rumors rife, has investors again coveting the risk reserve governing Yen.

This is a currency only a few trading sessions ago gave serious thought on extending an assault at 82 outright, a rate the BoJ would have been happy with, is now falling towards the rhetoric levels of concern by Governor Shirakawa of last week. Recent data from the US and Europe signaling slowing economic growth is hastening the currency return to lofty heights.

Market participants hearing and believing vague gossip, since being denied, about Greece extending its deadline for participation in PSI from this week to next has only fueled the speed of dominance by this safer-haven currency. Selling EUR/JPY outright this morning has triggered some stop-losses while the structure of the market has changed to bearish talk despite solid bids below. The fact that the markets continue debating the possibility of a Greek credit event should be able to maintain the underlying pressure on the single currency for some time further.

Long/Short March 6th

Euro data released this morning certainly is not currency friendly despite the numbers being in line with analysts forecasts. The second release of Q4 GDP from the Euro-zone has seen a confirmation of the -0.3% decline that was indicated in the first estimate. The data shows the same divergence as has been seen in the PMI data of late, emphasizing the weakness in the peripheral countries. Negative Euro-zone growth is likely this year and while the PMI’s have stopped the bleeding in the core, the same cannot be said for the peripheral countries where downside risks dominate.

Event risk is not being monopolized by the Greeks, its also high for AUD this week who have GDP and labor reports due for release, while in China, inflation, IP and retail sales will be published. Any weakness outright or by association and this currency will ease further. Despite the RBA leaving rates unchanged last night and regurgitating their February’s statement, the currency has been trading on the back foot with investors remaining weary of other regional fallout’s. It seems the market is not currently wearing the rose tinted glasses of the RBA. When risk takes a beating, so do the commodity and interest rate sensitive currencies. Can North America stop this mornings bleeding?

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EUR Bloodied by China

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