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By XE Market Analysis April 7, 2014 1:52 pm
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    XE Market Analysis: Asia - Apr 07, 2014

    The dollar fell in N.Y. trade on Monday, as Wall Street took another beating, and as Treasury yields slipped. EUR-USD traded to near 1.3750 from opening levels near 1.3720, as USD-JPY eased into the 103.00 level. USD-CAD faded under 1.1000, while cable reclaimed the 1.66 handle. There was no data to drive trade, so the poorer risk backdrop largely set the tone for the day.

    [EUR, USD]
    EUR-USD topped at 1.3745, and remained bid into the London close. Activity was light overall, though earlier comments from the ECB's Nowotny, who said there is no need for immediate ECB action, continued to resonate. A band of offers is reportedly at 1.3750-70 now.

    [USD, JPY]
    The BoJ is expected to increase stimulus in July, according to the latest Bloomberg survey, which founding 72% of analysts were forecasting this. The BoJ is expected to double purchases of exchange-traded funds (ETF) to 2 trillion yen and boost annual bond purchases by at least 10 trillion yen. This said, USD-JPY fell back toward 103.00 in N.Y., as risk appetite vanished again, and Treasury yields fell.

    [GBP, USD]
    Sterling was lower versus the euro today, which has risen across-the-board on ECB's Nowotny, who siad the ECB did not need to ease further. Cable followed the soft USD backdrop in N.Y. dealings, rising over 1.6620, up from London's low of 1.6565.

    [USD, CHF]
    EUR-CHF has settled lower after making a two-month high of 1.2249 on Friday. The up move reflects an unwinding of the Swiss franc's safe-haven premium. The cycle low of 1.2104 was left unchallenged during the recent risk-off phase. We see potential for a recovery to the 1.2300-1.2400 area, but this assumes there are no renewed flare-ups in geopolitical tensions.

    [USD, CAD]
    USD-CAD meandered on either side of 1.10 from the North American open, after putting in a 1.0967 low overnight. Offers noted from 1.1020 limited gains to 1.1009, while upbeat Canadian data seen last week should keep the near term bias to the downside. The pairing later matched the London low of 1.0967, and continued to find support over noted bids into 1.0960-50. Friday's 1.0957 lows should provide support as well, though stops are building under 1.0950.

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