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By XE Market Analysis April 30, 2014 2:17 pm
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    XE Market Analysis: Asia - Apr 30, 2014

    The dollar got a modest bump up following the better ADP employment report, though gains quickly turned to losses after the near-zero GDP outcome. EUR-USD had been on the rise into the N.Y. open, and eventually made its way to 1.3876 highs, very close to highest levels seen earlier this week. Cable meanwhile posted a peak of 1.6900, its best levels since 2009. USD-JPY stumbled after making intra day highs of 102.66 after the jobs data, later falling to 102.03. Trade was calm from the London close, ahead of the FOMC announcement, which revealed no surprises. The greenback inched up briefly, though settled back some into the close. FOMC trimmed QE by $10 bln to $45 bln, and reiterated rates will remain accommodative for a considerable time after the asset purchase program ends. There weren't any surprises in the statement. The Fed upgraded its assessment of the economy, noting activity has "picked up recently." Labor market indicators were mixed, but on balance are showing further improvement.

    [EUR, USD]
    EUR-USD was on the rise into the N.Y. open, after rebounding from session lows of 1.3774 into the EU CPI data, which missed the mark, but rising enough to take some pressure off the ECB. The euro opened near 1.3850, and made its way to intra day highs of 1.3776 after the weak U.S. growth data.

    [USD, JPY]
    USD-JPY made session lows, touching 102.03, after filling in noted 102.20 bids. More buyers were seen into 102.00, though stops are reported at 101.95, just under last Friday's 101.96 base. The lack of movement from the BoJ, and the soft U.S. GDP data may be enough to shake out some stale USD longs in the coming sessions.

    [GBP, USD]
    Cable moved to multi-year highs of 1.6900, a level last printed in 2009. The pound had struggled of late to hold over the 1.68 mark, though the resistance level swapped to support in London morning trade, shifting sentiment altogether. The soft U.S. GDP print was the catalyst for cable's run to trend high. Offers seen in place into 1.6870 were dispatched easily, and the market made a successful run for barrier options, noted at 1.6900.

    [USD, CHF]
    EUR-CHF traded on either side of 1.2200 in light trade, as risk levels were fairly neutral. USD-CHF moved lower, with the dollar in general, giving back most of Tuesday's gains. The CHF will remain tied to general risk levels, though with the SNB on guard for EUR-CHF, downside will be limited.

    [USD, CAD]
    USD-CAD matched Tuesday's low of 1.0944 in London, though traded back up to 1.0979 ahead of GDP data from both sides of the border. The in-line Canadian GDP data, and weak U.S. data saw USD-CAD dip back to 1.0950, before spending the remainder of the day largely between 1.0950 and 1.0975 BoC chief Poloz raised concerns on Canada's export sector on Tuesday, saying slower export growth could lead to a rate cut. He appears to be concerned with the strength of the C$ as well, which could see USD-CAD's time on the 1.09 handle or lower, limited.

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