NEWS / Foreign Exchange

European Forex Recap

• Dow Jones Industrial average closed Tuesday??™s session lower by 3.90 points at 13,309-37

• UK BRC Retail sales in April were +2.4% y/y from +3.9% the previous month. This was the lowest level since November 2006

• UK Nationwide consumer confidence in April came in stronger at 90 from 88 in March a touch better than market forecasts of 89.

• Dollar and Euro-yen were the main movers in the Asian session with the dollar-yen falling from 120.00 to 119.70 and Euro-yen from 162.50 to 162.15 reportedly on bond redemption selling by Japanese names (9.30pm EST)

• FX rates as at 11.00pm GBP/USD 1.9904/09  EUR/USD 1.3547/50  USD/JPY 119.76/79  USD/CHF 1.2174/78  USD/CAD 1.1060/65  AUD/USD 0.8280/84  NZD/USD 0.7357/61

• Japanese Leading Indicator Index for March was 40.00 and the Coincident Indicator Index was at 22.2 (1.00am EST)

• Germany??™s trade surplus in March increased to ?‚¬15.5 billion from ?‚¬14.7 billion in February slightly better than market forecasts (2.00am EST)

• Nikkei 225 closed Wednesday??™s session higher by 91.28 points at 17,748-12 (2.00am EST)

• Bank of England, there is a story doing the rounds that since the UK permanent salaries index has hit a 7 year high at 63.6 in April from 62.4 in March  as wages for British workers rose at their fastest pace as employers struggled to find staff to fill a growing number of vacancies. To this end market players are almost certain that the Bank of England will hike interest rates by 25 basis points tomorrow following their 2 day monthly meeting which starts today. Cable is higher from 1.9892 to 1.9920 (2.15am EST)

• Euro-dollar slipping lower on a medium term playergoes short and triggering stops around 1.3555, currently trading 1.3540/43 (2.50am EST)

• Major Japanese car manufacturer forecasting dollar-yen will be at 115.00 and Euro-yen at 150.00 for financial year 2007/2008

• Dollar-yen offers from 120.00 all the way up to 120.50 from proprietary interest, currently trading at 119.80/83 (3.15am EST)

• Swedish Industrial Production released stronger than expected at 1.4% m/m, the market had been expecting +0.7% (3.30am EST)

• The US Dollar turns the corner and is looking bid with Euro-dollar now trading at 1.3533/36, cable at 1.9884/89 and dollar-yen testing the highs and reported offers at 120-00 now trading at 119.95/98 (4.15am EST)

• Dollar-yen edging higher breaking 120-00 and taking out some of the offers but only manages to make a high of 120.06/09 (6.45am EST)

• FX rates as at 7.00am EST GBP/USD 1.9913/18  EUR/USD 1.3531/34  USD/JPY 120.05/08  USD/CHF 1.2184/88  USD/CAD 1.1079/84  AUD/USD 0.8284/88  NZD/USD 0.7356/60

Economic data due out later today

2.15pm EST US FOMC decision on US interest rates

6.45pm EST New Zealand Unemployment rate for Q1

9.30pm EST Australian Employment data for April

On Thursday both the Bank of England (7.00am EST) and the ECB (7.45am EST) will make their decision on interest rates

Ranges since 5pm EST on Tuesday

GBP / USD:                 1-9881             1-9933

EUR / USD:                 1-3532             1-3552

USD / JPY:                  119-65             120-04

USD / CHF:                 1-2165             1-2185

USD / CAD                 1.1045             1.1093

AUD / USD                 0-8265             0-8295

NZD / USD                 0-7345             0-7375