The dollar fell versus the euro as investor demand for U.S. government bonds waned and stocks rose. The yield on the two- year Treasury note rose 9 basis points to 1.73 percent. Yields move inversely to bond prices. The Dow Jones Euro Stoxx 50 index advanced 0.6 percent and December futures on the Standard & Poor's 500 Stock Index climbed 1.4 percent.
The yen fell against the dollar and the euro after the world's biggest central banks said they will act jointly to revive the financial markets.
The yen dropped versus the most-traded currencies after the Federal Reserve, Bank of Japan and European Central Bank joined with their counterparts around the world in a coordinated drive to reverse the seizure in credit markets. The cost of borrowing in dollars for three months jumped yesterday by the most since 1999 on concern losses and bankruptcies among financial institutions will spread.
The yen typically falls when appetite for higher-yielding currencies rises as traders put on so-called carry trades that take advantage of interest-rate differentials. The Japanese currency fell 2 percent to 70.53 per New Zealand dollar and 1.9 percent to 84.34 against the Australian dollar.

EUR/USD posted a strong rally from $1.4280 to $1.4541. Bids $1.4500/10, $1.4520/25, $1.4540.
GBP/USD Rate recovered to $1.8200 as market discounted rumour, boosted to $1.8250 on strong retail sales data. Rate dipped to $1.8180, as euro picked up a bid tone, taking euro-sterling to stg0.7947. Cable late rally to highs. Bids $1.8200, $1.8180/70.
USD/JPY opened European dealing around Y104.65, the central bank liquidity measures then pushing the pair up sharply to Y105.57. Subsequent dollar weakness took dollar-yen un.

US data starts at 1230GMT with the weekly jobless claims data, which is expected to fall 5,000 to 440,000 in the Sept 13 employment survey week, above the 435,000 level in the August employment survey week. At 1400GMT, the Philly Fed survey for September and leading indicators for August are due. The Philadelphia Fed index is expected to
improve to a reading o -7.7, still an indication of contraction in that region. The leading indicators index is expected to fall 0.2% after the 0.7% decline in the previous month. Negative contributions are expected from the spike in jobless claims and an acceleration in supplier deliveries.

The dollar fell versus the euro as investor demand for U.S. government bonds waned and stocks rose. The yield on the two- year Treasury note rose 9 basis points to 1.73 percent. Yields move inversely to bond prices. The Dow Jones Euro Stoxx 50 index advanced 0.6 percent and December futures on the Standard & Poor's 500 Stock Index climbed 1.4 percent.
The yen fell against the dollar and the euro after the world's biggest central banks said they will act jointly to revive the financial markets.
The yen dropped versus the most-traded currencies after the Federal Reserve, Bank of Japan and European Central Bank joined with their counterparts around the world in a coordinated drive to reverse the seizure in credit markets. The cost of borrowing in dollars for three months jumped yesterday by the most since 1999 on concern losses and bankruptcies among financial institutions will spread.
``Intervention by central banks helps to reduce risk aversion and will weaken the yen in a knee-jerk reaction,'' said Lee Hardman, a currency strategist at Bank of Tokyo-Mitsubishi Ltd. in London. ``But we still believe it will take more to turn this market around and are bullish on the yen.''
The yen typically falls when appetite for higher-yielding currencies rises as traders put on so-called carry trades that take advantage of interest-rate differentials. The Japanese currency fell 2 percent to 70.53 per New Zealand dollar and 1.9 percent to 84.34 against the Australian dollar.
``We're seeing a modest rebound in risk appetite,'' said Adam Cole, head of global currency strategy at RBC Capital Markets in London. The joint intervention ``signals that they will do what they can to help us through this situation,'' he said.

Correction off the $1.4541 highs found support back at reported bid level at $1.4480, with rate once again back above $1.4500, currently trading around $1.4508 after touching a recovery high around $1.4518. Offers now seen placed between $1.4520/25, a break above to open a move back toward earlier rally highs, with offers noted between
$1.4540/50. Above here and rate can push on toward $1.4575. Bids remain in place at 1.4480.

Resistance 3: Y106.60
Resistance 2: Y105.30
Resistance 1: Y104.90
Current price: Y104,81
Support 1: Y104.10
Support 2: Y103.50
Support 3: Y102.60
Comments: Tech on euro hasn't changed. Support is around session low on Y104.10/00. Below losses may widen to Tuesday’s low on Y103.50. Resistance comes at session high on Y104.90/00, then – at Y105.30. Stronger – at yesterday’s high on Y106.60.

Resistance 3: Chf1.1250
Resistance 2: Chf1.1160
Resistance 1: Chf1.1050
Current price: Chf1.0947
Support 1: Chf1.0960
Supporrt 2: Chf1.0880
Suppot 3: Chf1.0840
Comments: USD/CHF test support at around session low on Chf1.0960. Strong support is around Chf1. 0880 (38.2% of Chf1.0012 – Chf1.1422 rally), then – Chf1.0840. Resistance is near Chf1.1050/60, further – Chf1.1160 with stronger level comes on Chf1.1250 (Tuesday’s high).

Resistance 3: $1.8460
Resistance 2: $1.8300
Resistance 1: $1.8240
Current price: $1.8207
Support 1: $1.8120
Support 2: $1.8020
Support 3: $1.7960
Comments: GBP/USD has tested support in a sessional low on $1.8120. Below support is noted on $1.8020 and further on $1.7960. Minor resistance is around Wednesday’s high on $1.8240, then – at $1.8300/00. Key resistance comes at 38.2% Fibo of $2.0132 - $$1.7640 decline on $1.8460/70.

Resistance 3:$1.4560
Resistance 2: $1.4480
Resistance 1: $1.4440
Current price: $1.4421
Support 1: $1.4300
Support 2: $1.4240
Support 3: $1.4100
Comments: EUR/USD challenges resistance line on $1.4440 (Jan low). Next band of resistance remains at $1.4480 (15 Sep high). Support comes at session lows on $1.4300, then – at $1.4240 (50% of the $1.4100 - $1.4400 rally). Stronger level is around yesterday’s low on $1.4100.

EUR/USD $1.4325, $1.4360, $1.4225, $1.4070, $1.4050, $1.4040
USD/JPY Y105.20, Y104.65, Y106.75, Y106.85
EUR/CHF Chf1.5850

The yen fell against the dollar and the euro after the world's biggest central banks said they will act jointly to revive the financial markets.
The yen dropped versus the most-traded currencies after the Federal Reserve, Bank of Japan, European Central Bank, Swiss National Bank and Bank of England said they are taking coordinated action to ease the freeze in bank lending. The cost of borrowing in dollars for three months jumped yesterday by the most since 1999 on concern losses and bankruptcies among financial institutions will spread.
``Intervention by central banks helps to reduce risk aversion and will weaken the yen in a knee-jerk reaction,'' said Lee Hardman, a currency strategist at Bank of Tokyo-Mitsubishi Ltd. in London. ``But we still believe it will take more to turn this market around and are bullish on the yen.''

EUR/USD Retests earlier $1.4395 highs, the break above $1.4360 said to have provided the impetus. Rate makes a show above $1.4400 to $1.4402 but seen struggling in its initial attempts to progress higher.
GBP/USD Spiked up to $1.8250, from around $1.8090.
USD/JPY Spikes 60-points as the greenback gets a widespread boost on the co-ordinated central bank liquidity measures just announced. Dollar-yen hits fresh highs for the day around the Y105.30 area at time of writing.

US data starts at 1230GMT with the weekly jobless claims data, which is expected to fall 5,000 to 440,000 in the Sept 13 employment survey week, above the 435,000 level in the August employment survey week. At 1400GMT, the Philly Fed survey for September and leading indicators for August are due. The Philadelphia Fed index is expected to
improve to a reading o -7.7, still an indication of contraction in that region. The leading indicators index is expected to fall 0.2% after the 0.7% decline in the previous month. Negative contributions are expected from the spike in jobless claims and an acceleration in supplier deliveries.

Japan stocks rebounded from a three- year low as investors snapped up companies whose earnings may withstand an economic slowdown, while insurers rose after the U.S. government took over American International Group Inc.
Japan Tobacco Inc. jumped 6.3 percent, sending a gauge of food-related stocks to the sharpest gain in almost two years. Tokio Marine Holdings Inc., Japan's biggest insurance group, rose 5.3 percent after the Federal Reserve announced a rescue plan for cash-strapped AIG. Shinsei Bank Ltd. sank to a record low after announcing the biggest potential loss among Japanese banks from Lehman Brothers Holdings Inc.'s collapse.
The Nikkei 225 Stock Average rose 140.07, or 1.2 percent, to close at 11,749.79 in Tokyo. The broader Topix index rose 3.86, or 0.4 percent, to 1,121.43, after earlier gaining as much as 2.1 percent. Twenty of 33 industry groups on the Topix climbed.
The Federal Reserve Board, with support of the U.S. Treasury, invoked emergency powers to lend up to $85 billion to AIG to save the firm from collapse. Shares in Japanese banks and brokerages jumped in the morning session on confidence AIG's rescue would calm turmoil in financial markets.
Stocks paired gains after CNBC reported on its Web site that Morgan Stanley, the second-biggest U.S. securities firm, is weighing whether to remain independent or merge with a bank. The report came two days after rival brokerage Merrill Lynch & Co. agreed to be bought by Bank of America Corp.
Japan Tobacco, the world's third-largest listed cigarette maker which also sells soft drinks and frozen food, leapt 6.3 percent to 438,000 yen, sending the Topix Food Index to its biggest advance since December 2006. Japan Tobacco traded at 16.5 times earnings yesterday, the cheapest in at least a year.
Torii Pharmaceutical Co., a drugmaker controlled by Japan Tobacco, soared 6.8 percent to 1,622 yen, the most since April 2004. Astellas Pharma Inc., Japan's second-largest drugmaker, the sharpest gain since Aug. 4.
Makers of foods and drugs contributed about half of the Topix's gain.
Tokio Marine jumped 5.3 percent to 3,400 yen, recovering some of yesterday's 13 percent plunge. Sony Financial Holdings Inc., which operates insurance and banking subsidiaries, added 3.1 percent to 432,000 yen. Sompo Japan Insurance Inc. rose 2.1 percent to 867 yen.

European stocks posted the steepest three-day slide since 2002 after U.S. housing starts trailed forecasts and banks' borrowing costs jumped the most since 1999, deepening concern the real-estate slump and credit- market turmoil will push the region's economy into a recession.
Hochtief AG, Germany's biggest builder, dropped 4.6 percent after the Commerce Department said housing starts sank to the lowest level in 17 years. Fortis and Royal Bank of Scotland Group Plc retreated for a third day, leading financial shares lower as the cost of borrowing in dollars for three months surged. Anglo American Plc slid 9.3 percent and Xstrata Plc fell 8.2 percent on concern the economic slump will hurt demand for meta

The dollar declined against the yen as the Federal Reserve's $85 billion bailout of insurer American International Group Inc. failed to quell concern credit market losses will deepen.
The Fed will provide AIG with a two-year loan, take 79.9 percent of the New York-based company's stock and replace its management. The central bank kept its target rate for overnight lending between banks at 2 percent yesterday, rebuffing calls by some investors for an interest-rate cut.
However, with the FOMC now signaling no change in rates going forward and possibly considering cutting rates, that impetus has been removed. Indeed, much to the dismay of the Fed, their intervention in AIG failed to soothe investors' fears about the health of the markets, as indicated by the 4% or more drops in the DJIA and S&P 500. These moves were led by declines in financials, as shares of the two remaining 'big 5' investment banks fell by the most on record. This risk aversion also translated into massive flight-to-safety toward US Treasuries, as yields on 3-month Treasury bills fell to a 54-year low.
The US is not alone in experiencing massive banking consolidations, such as the sale of Merrill Lynch to Bank of America, as UK bank Lloyds TSB will reportedly acquire HBOS, which is the nation's biggest mortgage lender. Indeed, after the nationalization of Northern Rock earlier in the year, the UK government is surely looking to avoid having to take such measures once again. Meanwhile, the minutes from the Bank of England's September meeting revealed an 8-1 vote in favor of leaving rates steady, with one dissent in favor of 50bp cut.
The Japanese yen experienced wild volatility on Wednesday as the DJIA plummeted over 4 percent while flight-to-safety sent yields on 3-month Treasury bills to 54 year lows. Indeed, the low-yielder plunged nearly 1 percent against the British pound, but jumped over 2 percent versus the Australian dollar.
UK retail sales are also due at 0830GMT. Retail sales are expected to come in at -0.5% m/m, 1.6% y/y.
US data starts at 1230GMT with the weekly jobless claims data, which is expected to fall 5,000 to 440,000 in the Sept 13 employment survey week, above the 435,000 level in the August employment survey week. At 1400GMT, the Philly Fed survey for September and leading indicators for August are due. The Philadelphia Fed index is expected to
improve to a reading o -7.7, still an indication of contraction in that region. The leading indicators index is expected to fall 0.2% after the 0.7% decline in the previous month. Negative contributions are expected from the spike in jobless claims and an acceleration in supplier deliveries.

Japan's benchmark stock indices ended the day lower, although almost halving early losses. The benchmark Nikkei 225 was down 236.23 points, or 2.22%, at 11 497.62. The index was earlier down over 400 points. The broader-based TOPIX was down 23.75 points at 1097.68.

Resistance 3: Y106.60
Resistance 2: Y105.30
Resistance 1: Y104.90
Current price: Y104,81
Support 1: Y104.10
Support 2: Y103.50
Support 3: Y102.60
Comments: The dollar fell for a second day against the yen on speculation more financial institutions will fail as bank lending seizes up. Support is around session low on Y104.10/00. Below losses may widen to Tuesday’s low on Y103.50. Resistance comes at session high on Y104.90/00, then – at Y105.30. Stronger – at yesterday’s high on Y106.60.

Resistance 3: Chf1.1250
Resistance 2: Chf1.1160
Resistance 1: Chf1.1050
Current price: Chf1.1048
Support 1: Chf1.0960
Support 2: Chf1.0880
Support 3: Chf1.0840
Comments: USD/CHF holds under pressure after yesterday’s sell-off. Support is around session low on Chf1.0960. Strong support is around Chf1. 0880 (38.2% of Chf1.0012 – Chf1.1422 rally), then – Chf1.0840. Resistance is near Chf1.1050/60, further – Chf1.1160 with stronger level comes on Chf1.1250 (Tuesday’s high).

Resistance 3: $1.8460
Resistance 2: $1.8300
Resistance 1: $1.8240
Current price: $1.8226
Support 1: $1.8120
Support 2: $1.8020
Support 3: $1.7960
Comments: GBP/USD consolidates above broken yesterday channel resistance line from Jul 31 at $1.8020 (now strong support). Today’s data include UK Retail sales and M4 money supply. Minor resistance is around Wednesday’s high on $1.8240, then – at $1.8300/00. Key resistance comes at 38.2% Fibo of $2.0132 - $$1.7640 decline on $1.8460/70. Support comes at session low on $1.8120. Break back under $1.8020 will widen losses to $1.7960.

Resistance 3:$1.4560
Resistance 2: $1.4480
Resistance 1: $1.4370
Current price: $1.4369
Support 1: $1.4300
Support 2: $1.4240
Support 3: $1.4100
Comments: EUR/USD challenges channel resistance line from Jul 22 on $1.4370/80 after it failed to break it above earlier. Next band of resistance remains at $1.4480 (15 Sep high). Support comes at session lows on $1.4300, then – at $1.4240 (50% of the $1.4100 - $1.4400 rally). Stronger level is around yesterday’s low on $1.4100.

High Low Close
EUR/USD 1.4382 1.4092 1.4324
USD/JPY 106.70 104.11 104.33
GBP/USD 1.8243 1.7784 1.8138
USD/CHF 1.1245 1.0991 1.1043

EUR/JPY 151.52 147.48 149.44
EUR/GBP 0.7982 0.7861 0.7894
GBP/JPY 192.04 186.82 189.25
GBP/CHF 2.0146 1.9920 2.0024

Change % Change Last
Nikkei 225 +140.07 +1.20% 11,749.79
Topix +3.86 +0.40% 1,121.43
FTSE -113.20 -2.25% 4,912.40
DAX -104.19 -1.75% 5,860.98
CAC -87.29 -2.14% 4,000.11
Dow -448.22 -4.05% 10,610.80
NASDAQ -109.05 -4.94% 2,098.85
S&P -57.39 -4.73% 1,156.21
10yr Note -0.8100 -0.232% 3.410%
NYMEX Crude Oil +6.01 +6.59% 97.16
Gold +70.00 +8.97% 850.50

08:30 UK PSNCR (July), bln -12,6
08:30 UK M4 lending (July) provisional, bln +12,4
08:30 UK M4 money supply (July) provisional Y/Y 11,2%
08:30 UK M4 money supply (July) provisional 0,9%
08:30 UK Retail sales (August) Y/Y 2,1%
08:30 UK Retail sales (August) 0,8%
12:00 Switzerland SNB Interest Rate Decision 2,75%
12:30 USA Jobless claims (week to 13.09) 440К 445К
14:00 USA Philadelphia Fed index (September) -7,7 -12,7
14:00 USA Leading indicators (August) -0,2% -0,7%
20:00 USA M2 money supply (08.09), bln -5.5
22:45 New Zealand Current Account (2Q) -2,2В