U.S. Market January 30, 2001

Surprisingly strong Japanese figures released over night, kept JPY well supported all day in New York, although range trading dominated USDJPY, which moved in a 116.50 – 116.95 range. As the EURJPY cross was eagerly trying to break down through 107.00 all day without success, USDJPY closed in the middle of the range at 116.75. EURUSD floated around in a tight 0.9160 – 0.9212 range, mainly dominated by EURJPY orders in early trading. Limited interest was seen in USDCHF, which closed offered at 1.6565 as the EURCHF cross traded very much on the defensive. GBPUSD did almost nothing to attract speculators, while staying in a very narrow 1.4565 – 1.4605 band all day. Both AUDUSD and NZDUSD came to a standstill as well. With range trading dominating all major currencies, evidently everyone is focused on the outcome of this week’s FOMC meeting, where a rate cut of another 50 basis points is widely expected. The GDP figure, which will be released coming Wednesday, and Employment statistics to be released coming Friday, will be watched closely as to see if the U.S. economy has in fact slowed down to zero growth, as Fed’s Alan Greenspan warned about last week.

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