By Ian McKendry CHICAGO (MNI) – ECB Governing Council member and Governor of the Central Bank of Cyprus Athanasios Orphanides Friday said Europe has “shattered investor trust” and it is clear the single monetary policy for Europe has been ineffective. “It is very difficult to argue that single monetary policy is working at this moment,” [...]

Chief economist Olivier Blanchard on Bloomberg TV: Europe will “probably” have recession Greek haircut “could have to be larger” Greek economic numbers “are not good” There will be “missed targets” in Europe European weakness beginning to spill over to emerging markets Credit downgrades coming but priced in

Non-farm payrolls +200K vs +150K exp Unemployment rate 8.5% vs 8.7% exp Canada loses 25.5K full-time jobs, adds 43.1K part time workers Fed’s Dudley (voter) more accommodation appropriate Fed’s Rosengren (non-voter) says Fed should by more MBS Hungary downgraded to junk, PM complains Monti: Unicredit problems due to “temporary” issues, Italian banking strong, will balance [...]

Analysts expect gold to hit fresh highs in 2012. All but 23 of 26 analysts surveyed see a record high in 2012.

Non-commercials in the latest CFTC Commitments of Traders report: EUR -139K from -128K JPY +56K from +22.5K AUD +46.5K from +32.5K CAD -23K from -21K GBP -32K from -29K NZD +2.5K from +1.4K The data from the close on Jan. 3.

Monti says mysterious “temporary” difficulties were the culprit for the problems raising capital at Unicredit. “I think the difficulties of UniCredit were above all linked to the capital raising exercise, which in this market situation, encountered some temporary difficulties but the Italian banking system is fundamentally solid.”

Gold started the year off right, gaining 3.3% to $1616. But it’s early to be piling into gold longs. We are rebounding from very low levels. If we can get about $1641, that’s a buy signal. I don’t think gold will go much higher from here before it goes back to the recent lows.

US DATA: Dec Tsy STRIPS -$1.1b but -$874m ex maturing securities. The 3.125% of Nov’41 had $425m stripped and the 4.375% of May’41 had $1.35b stripped; reconstitution was seen in the higher coupon bonds.

By Yali N’Diaye BALTIMORE (MNI) – From now on, the Federal Open Market Committee will incorporate funds rate forecasts in its Summary of Economic Projections, with the notion the document will “become more meaningful,” Fed Governor Sarah Bloom Raskin said Friday. Answering questions following a luncheon speech to the Maryland Bankers Association First Friday Economic [...]

Below here, there no support until 76.80 — if 20 pips is your thing.

Evidently, I have been watching the wrong pattern in USD/CAD. I spoke about a breakout (to the downside) from a wedge (the purple wedge). What’s now clear is that support kicked in precisely where it should have, looking at the wedge from a longer-term. I didn’t trade on the breakout because the copper chart failed [...]

By Steven K. Beckner RICHMOND, Va. (MNI) – Federal Reserve Governor Elizabeth Duke downplayed risks that the Fed’s aggressive monetary easing of recent years will lead to higher inflation Friday. But she vowed that the Fed will be vigilant against higher inflation. Duke, answering questions following a luncheon speech to the Virginia Bankers Association and [...]

By Yali N’Diaye BALTIMORE (MNI) – Noting the weakness of fundamentals, and labor markets in particular, Federal Reserve Gov. Sarah Bloom Raskin said Friday the “deployment of unconventional policy tools has been completely appropriate to help promote the Federal Reserve’s statutory mandate of maximum employment and price stability.” “In that regard, although the pace of [...]

By Steven K. Beckner RICHMOND (MNI) – Federal Reserve Governor Elizabeth Duke said Friday the depressed housing market continues to slow the recovery and European financial strains pose “downside risks,” but the Fed also faces potential “upside risks,” so she did not suggest additional monetary stimulus to help the housing sector. Monetary policy is “appropriate,” [...]

–Admin ‘Deeply Concerned’ About Number of Long-Term Unemployed By Heather Scott WASHINGTON (MNI) – The December jobs report had some encouraging news but unemployment measures are far above pre-recession levels and the Obama administration remains “deeply concerned” about the number of workers unemployed for extended periods, a U.S. Treasury official said Friday. The report, which [...]

PARIS (MNI) – France and Italy Friday underscored their fundamental agreement on the way out of the Eurozone debt crisis. Speaking to reporters after a bilateral meeting here, French President Nicolas Sarkozy and Italian Prime Minister Mario Monti announced that they will meet on January 20 in Rome with German Chancellor Angela Merkel to prepare [...]

Speaking at a conference in Chicago…

Won’t wait for agreement on transaction tax Unacceptable that no tax imposed on transactions And he’s the right-winger in the French presidential race…sheesh. EUR/USD “rallies” are incredibly shallow, stalling in the 1.2730 area since bottoming at 1.2697. UPDATE: Sarkozy says the end of the euro would be the end of Europe and the end of [...]

By Jerry Kronenberg HARTFORD, Conn. (MNI) – Boston Federal Reserve President Eric Rosengren Friday said he thinks the U.S. unemployment rate can eventually get down to around 5%, but “we’re so far away from that (now)” that the Fed must do more to get joblessness down. “Ideally, we would get back into the 5% to [...]

This was out early this morning, but it’s interesting nonetheless. S&P seems to have come to terms with its irrelevance. France would not necessarily suffer financially if its credit rating was lowered from the current top-notch AAA grade, as U.S. experience shows, representatives of rating agency Standard & Poor’s said in an interview published on [...]