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The Australian and New Zealand dollars fell for a second day versus the yen as concern that Greece will struggle to contain its debt crisis damped demand for higher-yielding assets. Both South Pacific nations’ currencies slid after Standard & Poor’s cut Greece’s credit ratings to “Selective Default.” S&P cut Greece’s credit grade from CC, two levels above default, after the government added clauses to its debt designed to mop up investors unwilling to take part in an exchange, the New York-based company said in a statement yesterday.
Greece published the formal offer document last week for its agreement to exchange bonds for new securities, with investors taking a 53.5 percent reduction in the value of their investments. The restructuring’s use of so-called collective action clauses would trigger credit-default swap insurance contracts on the nation’s debt, according to the rules of the International Swaps & Derivatives Association.
The euro erased losses against the yen before the European Central Bank allots a second round of unlimited three-year funds tomorrow to help shore up the region’s banks.
Europe’s central bank will calls for bids today in the tender of unlimited three-year funds and will announce the allotment amount tomorrow. Financial institutions may ask the ECB for 470 billion euros ($631 billion) in funds, according to the median estimate.
EUR/USD: during the Asian session the pair rose, fixed above $1.3400.
GBP/USD: during the Asian session the pair decreased, receded from a level of highs.
USD/JPY: during the Asian session the pair fell, after showed new month’s high.
Release of the final state CPI data from Germany will see the flash HICP data for February today, although scheduled data releases in Europe start at 0710GMT with German GfK consumer confidence data. EMU data at 1000GMT includes the economic sentiment survey and business climate indicator for February. At 1730GMT there is a speech by SNB vice president Thomas Jordan at the Neue Zuercher Zeitung panel discussion, in Zurich. US data starts at 1245GMT with the weekly ICSC-Goldman Sachs Mall data, while at 1330GMT, durable goods orders are expected to fall 1.0% in January, after rising 3.0% in December. The weekly Johnson Redbook Chain Store Sales data is then due, at 1355GMT, just ahead of the 1400GMT release of the S&P/Case-Shiller Home Price Index. At 1500GMT, consumer confidence is forecast to rise to a reading of 63.0 in February after dipping to 61.1 in January.
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