Fundamental Headlines
• USDJPY – Japanese CPI data reflected mounting inflation pressures stemming from increases in energy and food costs. However, with wage growth still falling negative despite tightening labor market conditions, the Bank of Japan is highly unlikely to take inflation threats seriously and is expected to leave rates on hold at 0.50 percent in the near-term. Do you follow the Yen daily? Visit the Japanese Yen Currency Room for resources dedicated to the Yen.
• GBPUSD – According to Nationwide Building Society, UK house prices fell 0.5 percent in December, marking the second consecutive month of declines as demand wanes in the face of affordability issues and stricter lending standards. Nevertheless, the British Pound has held strong against the greenback. What do you think will happen to Cable? Join the discussion and voice your opinion on the DailyFX Forum.
• USDCHF – At first glance, Swiss data released this morning appears to be unsupportive of the Swissie’s gains, as the November UBS Consumption Indicator eased to 2.131 while the KOF Leading Indicator slipped to a seven month low of 1.99 in December. Though these indices did fall lower - indicating a slowing in consumption and economic growth in coming months – the figures are relatively high and tight labor market conditions along with strong demand for Swiss goods should keep the economy's engine running at a fairly robust pace.
• Bhutto Killing Inflames Pakistan (link) – The Wall Street Journal
• Japan Stocks Slump After Goldman Predicts More Subprime Losses (link) – Bloomberg
• Brown Should Give King Second Term at BOE Helm, Lawmakers Say (link) – Bloomberg
• UK House Prices Fall for Second Month (link) – Financial Times
• Europe Retail Sales Drop for Third Month, PMI Shows (link) – Bloomberg
• Hedge Funds Feeling Pinch on Credit, Too (link) – The Wall Street Journal
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