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Forex Flash: Few factors standing in way of USD growth status – UBS

Many longer-term participants in the FX markets have started to express satisfaction of late that after many years of frustration, the USD/JPY is finally starting to move, or the BoJ/Japanese government is getting its act together. “While valid, this view perhaps gives too much credit to the Japanese drivers, while the dollar side of the argument is often overlooked.” writes Research Analyst Gareth Berry at UBS.

If the economy, notwithstanding the fiscal issues at hand, had not performed to the extent that markets have been willing to even defy Fed commentary on stimulus provision and nudge Treasury yields higher in addition to pushing equity markets to record highs as of this week, then something has to be going right. So long as current macroeconomic and financial conditions can hold, what's to stop yield and growth-starved European and Japanese investors from pushing more money into the US and propelling the dollar to growth status?

Forex: USD/CAD holds above 1.0300

The USD/CAD has been trading off its European highs (1.0316) Friday, ahead of some pivotal data releases later today during the US session. Though easing slightly, the pair is now trading at 1.0305/07, holding in positive territory.
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Forex Flash: USD/JPY set to challenge the March 2008 spike low at 95.77 - Commerzbank

After seeing the USD/JPY taking out 94.77, Commerzbank analysts see the USD/JPY set to challenge both the March 2008 spike low at 95.77 and the TD resistance at 95.62. “These will need to be cleared to confirm another leg higher is underway to 99.70 (50% retracement of the 2007 to 2011 drop) and then 101.40/67 (the 2000 and 2005 lows)”, wrote analyst Karen Jones, expecting the time zone gap to 95.10 of this morning to be filled ahead of further gains (gap between where market went overnight and where London left it).
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