The dollar was broadly higher in Asian trading as the EUR-USD succumbed to rate cut expectations and the S&P downgrade for Spain, triggering stops under 1.3289 and falling to lows of 1.3245 and the lowest in a month. Similarly, NZD-USD fell to one-month lows of 0.5592 on a negative foreign currency ratings outlook from S&P and poor business sentiment survey results. Weaker commodities and the fall in EUR and Kiwi helped drag AUD to one-month lows of 0.6740. Other currencies also succumbed to USD strength with USD-CHF rising to 1.1229 with USD-CAD rising to highs of 1.2214. A spate of weak BRC, BCC and RICS data from the UK and a plethora of layoff announcements in the UK sent sterling to lows of 1.4727. USD-JPY surprising defied the 4.79% slide in the Nikkei after warnings from Nakagawa on forex, and traded around 89.30-50 much of the session, above the NY low of 88.89. Asian stock markets were mixed and treasury yields were marginally firmer. Oil prices continued to fall, dropping under $37 with base metals under pressure on global demand fears. Gold prices bounced slightly, defying the fresh USD strength.
