By Bridge News
London--Jan. 17--The following is a summary of overnight moves since Europe's close, plus possible leaders for the session ahead:
Europe Open: USD/JPY continues retreat
--USD/JPY led the way in overnight trading, selling from Japanese names reversing a late US recovery, and taking the EUR crosses down with it. However, the EUR found bids late in Asian trading.
--USD/JPY came off a late US high of 117.95 to hit a 6-day low of 116.90 in the Asian afternoon, pressured by selling from US and Japanese names plus exporter selling of the EUR/JPY cross. The LDP's Aizawa was reported to have said JPY weakness has become excessive, but countered this by saying that the BOJ should enact a quantitative easing policy. Japanese exporters still have interest to sell during the 3rd and 4th weeks of January, according to traders.
The market will be concentrating on US Treasury Secretary nominee O'Neill's confirmation hearings at 1430 GMT following rumors he would relax the US' strong USD policy.
--EUR/JPY was carried off a late US high of 111.21 to hit 110.04 in the Asian afternoon, tracking USD/JPY. The cross found short covering bids from Japanese banks late in the session, however, and pushed to the 111 figure.
--EUR/USD firmed to touch 0.9450 in late Asian trading, driven by events in the EUR/JPY cross. ECB Vice President Noyer speaks on EMU accession issues at 0845 GMT, while German Chancellor Schroeder speaks at 1500 GMT. Wednesday could see the release of revised German November manufacturing orders data.
--USD/CHF traded a 1.6300-1.6400 range. Wednesday sees the release of US December CPI and industrial production data at 1330 GMT and 1415 GMT respectively.
--EUR/GBP consolidated within a 0.6380-0.6420 range, while cable recovered from Tuesday's 1.4660 low to reach the 1.4725 region. Wednesday sees the release of UK November average earnings and December unemployment data at 0930 GMT. BOE governor George, speaking late on Tuesday, said he is not sure if lower UK price pressures are a new trend, or temporary. The Independent reports that Germany's E.On is in talks with the UK's PowerGen, see below.