MORNING BRIEFING: Greece’s debt rating lowered by Moody’s
    
What’s new:
United States: Bullard says the impending European debt crisis does not seem to affect the US
United Kingdom: CPI expected at 10:30 CET today
Euro zone: Moody’s lowers Greece’s debt rating
Japan: BoJ leaves interest rates unchanged

Today:


Overnight Rates and Indices:
EURUSD: 1.2232 - 1.2196.
USDCHF: 1.1432 - 1.1396.
GBPUSD: 1.4768 - 1.4729.
EURJPY: 112.12 – 111.58.
USDJPY: 91.69 – 91.41.
DowJones: 10'190.89 -0.20%
NASDAQ: 2'243.96 +0.02%
S & P 500: 1'089.63 -0.18%
Nikkei: 9'898.28 +0.19%
Shanghai: closed
Gold: $ 1,220.90
Crude Oil: $ 75.32

Comment :

The St. Louis Fed President, Bullard, does not see the impending European debt crisis spread to the US, adding that the crisis should not delay the timing of the first rate hike by the Fed.

Barring surprises, Consumer Price Index for the month of May, scheduled at 10:30 CET today, is expected at 0.3%. A good indication of future inflation in Britain which should not prompt the BoE to increase its interest rates in the immediate future. Attributed mainly to the costs of energy, the increase in VAT and the weakness of the Pound Sterling, the recent strength of inflation indicators in Britain should be tempered; the CPI today should confirm this. Will we see a classic 'buy the rumor and sell the news’ after the publication of the CPI?

Moody's has followed rival S&P after lowering Greece’s debt rating by 4 points, from A3 to BA1, classifying them as 'junk bonds'. The announcement late yesterday of the European market has been a cause for renewed selling of Euro against the USD, as the pair could not break the resistance just below 1.23.

As expected, this morning the Bank of Japan left rates unchanged at 0.1%. The BoJ also announced a total of $33 billion USD at the disposal of commercial banks, to support industries with growth potential. This measure does not seem to convince analysts, who doubt its effectiveness in supporting the hesitant recovery in the Japanese economy.

Good day,

Pascal Bovay
Trading Desk
RTFX Ltd
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