EUR/usd
The market remains in the consolidation phase, with EUR/USD fluctuating around 1.29. Various discrepant news releases are tilting the balance first to one side and shortly after to the other one. It's important that yesterday the single currency didn't surrender to bears and managed to get over the morning pessimism of the markets. The slight upward revision of the EU Manufacturing PMI data for September inspired the markets with hope. Later that day the ISM Manufacturing PMI statistics for the USA were published. This index proved to be surprisingly good. Instead of the expected 49.8 (which means a slight decline against last month's reading), the index showed some growth of activity in the sector, stopping at 51.5. It was remarkable, but not surprising to see the evidence of another wave of price rise, as the corresponding index grew to 58.0 against 54.00 a month ago and 39.5 two months ago. However, since we look forward to the employment data, which is scheduled for release on Friday, we were particularly interested in the employment sub-index. It also brought good news, having risen up to 54.7, the highest level since June. Yet, it has little correlation with the employment situation in the sector, estimated by the Bureau of Labor Statistics, as the jobs increase in June made just 7K against 13K a month before and 23K a month later. Today we won't see any important statistics for the USA and Europe. What attracts attention is that now Germany doesn't want Spain to hurry with asking for help, preferring to avoid “individual” bailouts, in the meantime Spain's Rajoy has pointed out that he may well make an official request.
GBP/USD
Unlike the euro, the pound didn't show much will to live yesterday. Partly it was connected with the poor Manufacturing PMI data. As indicated by the report, the decline in this sector became sharper in September, as the index dropped to 48.4 compared to 49.5. Elizabeth II's 60-yr reign celebration is over, same with the Olympic Games, snow also hasn't been seen yet, but manufacture still refuses to recover. Now Office for National Statistics and the BOE will have to think of other reasons for the weakness of the sector. The best candidate for the role here is the European sovereign debt crisis, but it can hardly justify the British factual weakness against the euro zone.
USD/JPY
The Japanese yen is gradually getting weaker. USD/JPY has risen to 78.0 by now. The sequence of 4hr candles shows confident, albeit moderate, growth. Apparently, the market participants have decided to play safe before Friday's conference of BOJ, seeing that the DM CBs are actively easing their policies to stimulate their domestic economies to the detriment of the emerging world.
AUD/USD
RBA has still decided to cut its interest rate by a quarter of a percent. It's quite likely that the bank has been urged by the activity of the ECB and Fed, which earlier in September promised to put a pressure on the interest rates in their regions by extending the CB balance sheets. Australia stays far from it. It still has much space for maneuvering within the limits of their traditional monetary policy – interest rate reduction. The decisive step of RBA's Stevens pushed the aussie down to 1.03, however now the pair is consolidating around this mark. Other markets feel quite good – there's no need in falling further.
