ZuluTrade Blog

RBA delivered the well expected rate cut, AUDUSD dropped on the announcement, but recovered all the losses

Market View | Tuesday, June 5, 2012 3:34 AM GMT

Good Morning ,

- Risk overall continued to recover. EURUSD rallied to 1.2543. RBA delivered
the well expected rate cut, AUDUSD dropped on the announcement, but
recovered all the losses and even rallied higher after the cut (range 0.9715-
0.9790). Markets will wait for any details from the G7 conference call
(likely to be held for preparations for the upcoming G20 meeting in two
weeks).

- Stocks: Nikkei +0.89 %, Hang Seng +0.85 %, Shanghai Composite +0.22 %,
Dow Jones -0.14 %, S+P500 +0.01 %

- Greece has at least a one in three chance of leaving the 17-country euro area
within months of a June 17 election that could halt its international
bailout, according to a report by Standard & Poor's Ratings Services.

- Portugal has passed its fourth bailout review and will receive its next
tranche of rescue loans from international creditors, Finance Minister Vitor
Gaspar said on Monday.

- German Chancellor Angela Merkel said Monday that she was open to establishing
a European banking authority as a long-term solution to the continent's
financial crisis. Merkel told reporters ahead of a private session with EU
Commission President Jose Manuel Barroso that the pair "will also talk about
to what extent we have to put systemically (important) banks under a specific
European oversight."

- Germany may come under pressure from the Group of 20 major economies to step
up spending as the bloc looks to encourage stronger economies to return to
stimulus mode in support of global growth, a G20 official in Asia told
Reuters on Tuesday.

- Japan's finance minister said Tuesday that finance officials from the
Group of Seven nations must find common ground on the state of the world
economy, but he declined to confirm whether the group will hold a
teleconference later in the day.

- Finance ministers and central bank governors from the Group of Seven
countries will hold a call today to discuss the European debt crisis. "We do
have continuing discussions," Canadian Finance Minister Jim Flaherty told
reporters yesterday in Toronto. He said G-7 members would have more talks
today ahead of a summit of leaders from the Group of 20 in two weeks and
later said in Ottawa that officials would discuss "the situation in Europe,"
without elaborating about the call.

- The Reserve Bank of Australia cut its benchmark interest rate by a quarter
percentage point to 3.50 percent and to the lowest since 2009 as Europe's
debt crisis and slower Chinese growth overshadowed a stronger domestic labor
market, according to the statement.

- Australia Data Recap                       Period    Survey      Actual      Prior      Revised
* AiG Performance of Service Index       May           -            43.5        39.6           -
* Current Account Balance                    Q1    -14850m    -14892m  -8374m     -9639m
* Australia Net Exports of GDP Q1 -0.7 -0.5 0.3

- China Data Recap                    Period    Survey     Actual     Prior
* China HSBC Services PMI          May          -           54.7      54.1

- The Chinese government has called on key agencies including the central bank
to come up with plans to deal with the potential economic risks of a Greek
withdrawal from the euro zone, three sources with knowledge of the matter
told Reuters on Monday. The sources said the plans may include measures to
keep the yuan currency stable, increase checks on cross-border capital flows
and stepping up policies to stabilise the domestic economy.

- 1600 US ISM Non-Manufacturing Composite May
- 1300 Fed Fisher
- 2015 Fed Bullard
- 0945 Italy PMI Services May
- 0950 France PMI Services May
- 0955 Germany PMI Services May
- 1000 Eurozone PMI Services May
- 1000 Eurozone PMI Composite May
- 1100 Eurozone Retail Sales Apr
- 1200 Germany Factory Orders Apr
- 1030 IMF Lagarde
- 1530 IMF Lagarde/ECB Asmussen
- 1430 Canada Building Permits Apr
- 1500 Bank of Canada Rate Decision - no change expected

 (CET)

Have a good day !

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