EUR: While it is generally agreed that some banks and financial institutions in Europe and around the world may find themselves at the point of collapse as the second wave of the financial crisis unveils, the euro received surprising support from ECB today. ECB lent banks below forecasted amount, only EUR131b instead of expected EUR250b. Tomorrow EU banks are expected to repay EUR442b borrowed for 12 months. Traders were encouraged by the sign that the banks in Europe still have a lot of liquidity left, although the real situation will be seen later this month when all banks will have a so called stress test. At 11.30 GMT EUR is trading around 1.2283. USD: The USD is stronger against most of other currencies in the overnight session. The Consumer Confidence Index fell sharply and unexpectedly since last month: 52.9 vs. 62.8. The inflation expectations index edged down to 5.2% from 5.3%. The labor market also declined. All this indicators provide another confirmation that the Fed will most likely keep the rates low for a long period. AUD: The AUD rallied overnight on the local fundamental news, which showed the banks increase lending and the property prices grow, as well as on the fact that the local stock market continued to fall. There is still an underlying concern that we are up for a prolonged second wave of the crisis and that makes some analysts to recommend selling AUD on rallies. Adds to it the fact that the European crisis may sooner or later have its effect on Australian economy. The AUD is trading around 0.8524. Oil: After falling for almost 2 weeks the oil is up today by at least 30c in the overnight session. That was generally due to news that the typhoon Alex is about to hit the Gulf of Mexico and disrupt oil production. Gold: Gold retreated yesterday and today from its record highs, however it continues to attract investors seeking safe heaven assets. The gold price is expected to be strong against EUR and GBP and it could be pushed to new highs again and again. When everything else falls, people turn to gold as a safe asset and so far this year it gained 16%. It has retreated yesterday from its record high and allowed investors to take profits. With the Fed indicating low rates for an extended period of time has questioned the dollar recent strength in recent trading session’s and by default the commodity has provided an alternative investment vehicle. Of course for as long as there concerns about European economic heath, there would be strong demand for gold. Year-to-date, gold has gained +16%. Gold is currently trading around 1242.65

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