There are sell stops through 1.2440!!!

Stops gone off through 1.2460 and we’ve been as low as 1.2453 so far.

THAT’S WHERE IT SHOULD BE NOW!!!

“Moderate”

Phew,  thank goodness for that.  I have to tell ya, I was getting really worried there for a minute 

BERLIN (MNI) – The International Monetary Fund sees a
recapitalisation need for Spanish banks of below E50 billion, German
daily Die Welt reported Friday on its website citing a yet unreleased
IMF report.

The European Union and the German government have up to now
expected a capital need for Spanish banks of between E50 to E100
billion, according to Die Welt. “The amount that the IMF has determined
is below this range,” an IMF official with knowledge of the report told
the newspaper. The IMF is to release the report next Monday.

Fitch Ratings on Wednesday downgraded the credit rating of Spain by
three notches to ‘BBB’ from ‘A’. Fitch said it estimated the likely
fiscal cost of restructuring and recapitalising the Spanish banking
sector at between E60 to E100 billion.

The German weekly Der Spiegel reported over the weekend that the
German government had urged Spain to apply for financial aid from the
European bailout fund EFSF in order to prop up its ailing banking
sector, but that the Spanish government resisted this demand.

On Wednesday, the parliamentary leader of German Chancellor Angela
Merkel’s CDU/CSU bloc, Volker Kauder, openly called on Spain to apply
for financial aid. “I do think that Spain needs to tap the rescue fund –
not because of its state [finances] but because of its banks,” he told
German ARD public television.

German government spokesman Steffen Seibert said on Wednesday that
the European bailout funds were ready to support Spain if the country
applies for aid and accepts the conditions tied to it.

However, Seibert reaffirmed the government’s stance that the
European temporary rescue fund EFSF and the planned permanent ESM can
lend only to states and not directly to banks.

“The principles are clear, the request must come from a
government,” Seibert said at a regular press conference here. “This
government will then be liable and accepts the conditions tied to
getting the aid.”

These conditions could be “specific for the concerned banks, which
get aid, or possibly for the whole financial sector of the country that
gets aid,” he explained.

Seibert added that if the Spanish government decides to request aid
“then the European instruments are ready under the described terms.”

Merkel said on Thursday, “it is important to stress that we have
created the instruments of support in the Eurozone, and Germany is ready
to work with these instruments whenever necessary.”

–Berlin bureau: +49-30-22 62 05 80; email: twidder@marketnews.com

[TOPICS: M$X$$$,MGX$$$,M$$CR$,M$S$$$,M$G$$$,MT$$$$]

• Reiterates no decision until after bank audits

-Adds Detail To Version Transmitted At 0830 GMT
-UK May producer output prices -0.2% m/m; +2.8% y/y
-UK May producer input prices -2.5% m/m; +0.1% y/y

LONDON (MNI) – A sharp fall in oil prices drove UK input prices
lower in May, forcing the yearly rate down to its lowest level since
September 2009.

Input prices fell 2.5% on the month, with the drop almost entirely
due to the fall in crude oil prices, which knocked 2.2 percentage points
off the monthly move. Output prices fell 0.2% on the month, with the
data highlighting the rapid diminution of pipeline inflation.

The 2.5% monthly fall in input prices was the largest since
December 2008 and left input prices up just 0.1% on the year, the lowest
annual rate since September 2009.

After oil, the next largest contributor to the monthly move in
input prices was imported metals, which knocked 0.21 percentage point
off, falling 2.7% on the month.

On the output price side, the yearly change dipped to 2.8% in May
from 3.2% in April, the lowest reading since November 2009.

Petrol prices had by far the largest downward effect, knocking 0.31
percentage points off the monthly rate.

Core output prices in May fell to 2.1% from 2.3% in April, hitting
their lowest level since January 2010. Core output prices were flat on
the month.

Food ouput price inflation eased, dropping 3.3% on the year in May
from 3.6% in April, hitting its lowest level since November 2010.

All the producer output and input price reading were lower than
analysts’ median forecasts.

-London bureau: 0044 20 7862 7491; email: drobinson@marketnews.com
[TOPICS: M$B$$$,MABDS$]

-UK May producer output prices -0.2% m/m; +2.8% y/y
-UK May core output prices unchanged m/m; +2.1% y/y
-UK May producer input prices -2.5% m/m; +0.1% y/y

LONDON (MNI) – A sharp fall in oil prices drove UK input down in
May, forcing the yearly rate down to its lowest level since September
2009.

Input prices fell 2.5% on the month, with the drop almost entirely
due to the fall in crude oil prices, which knocked 2.2 percentage points
off the monthly move. Output prices fell 0.2% on the month, with the
data highlighting the rapid diminution of pipeline inflation.

The 2.5% monthly fall in input prices was the largest since
December 2008 and left input prices up just 0.1% on the year, the lowest
annual rate since September 2009.

After oil, the next largest contributor to the monthly move was
imported metals, which knocked 0.21 percentage point off, falling 2.7%
on the month.

On the output price side, the yearly change dipped to 2.8% in May
from 3.2% in April.

Petrol prices had by far the largest downward effect, knocking 0.31
percentage points off the monthly rate.

-London bureau: 0044 20 7862 7491; email: drobinson@marketnews.com
[TOPICS: M$B$$$,MABDS$]

–BOE/GfK NOP Survey: May Yr Ahead Inflation Expectations 3.7% V 3.5%
–Two-Year Ahead Expectations Rise To 3.4% From 2.9% In February
–May Longer-Term Inflation Expectations 3.6% Vs 3.4% In Feb
–Satisfaction With Job Done By BOE On Inflation Drops To 11% Vs 20%
–Survey May Fuel MPC Hawks’ Concerns On Inflation Outlook

LONDON (MNI) – Public inflation expectations for the year ahead
have risen to 3.7% – up from 3.5% seen in February, according to the
latest Bank of England/GfK NOP Inflation Attitudes survey.

Two-year and longer-term inflation expectations also rose. Two-year
inflation expectations climbed to 3.4% from the 2.9% seen in February.

The rise in inflation expectations will underline concerns among
some members of the Bank of England’s Monetary Policy Committee that the
persistently above-target level of inflation outturns may be dislodging
inflation expectations.

Yet how far these higher expectations can feed through into
stronger wage and price pressures, given the underlying weakness of the
economy remains to be seen.

The survey showed a rise in the percentage of the population
expecting interest rates to rise over the next 12 months, with 41% now
anticipating a rise compared with 35% in February.

Satisfaction among the public with the way the BOE is setting rates
to control inflation – fell to +11 in May from +20 in February, another
element in this report which may jangle alarm bells among the more
hawkish of the MPC.

Public perceptions of the current rate of inflation fell slightly
to a median of 4.7% from the 4.8% seen in February, the survey showed.
That compares with an annual CPI outturn of 3.0% in April.

Data for this survey was collected between May 17-22.

–London newsroom: 4420 7 862 7492; email: ukeditorial@marketnews.com

[TOPICS: M$B$$$,M$$BE$,MABPR$,MT$$$$]

UK DATA: May Input Prices Plunge Due To Oil; Output Prices Dip
-UK May producer output prices -0.2% m/m; +2.8% y/y
-UK May core output prices unchanged m/m; +2.1% y/y
-UK May producer input prices -2.5% m/m; +0.1% y/y
-NS: Crude oil knocked 2.2pp off 1 month change in input prices
-NS: Petrol knocked 0.3pp off 1 month change in output prices
-NS: Y/Y core output prices lowest since jan 2010
-NS: Y/Y input prices lowest since Sep 2009
-UK May input, output, core output all below median forecasts
————————————————————————
A sharp fall in oil prices drove UK input down in May, forcing
the yearly rate down to its lowest level since September 2009. Input
prices fell 2.5% on the month, with the drop almost entirely due to the
fall in crude oil prices, which knocked 2.2pp off the m/m rate.

• ECB might have to react if growth risks materialise

Heaven forbid you might be proactive!!   Give me a break

• Better to use instruments to assist Spain sooner rather than later (yes, get a bloody move on!!)
• Greece has long-term structural problems
• Spain is in different situation than Greece
• Spanish banks are problem, not economy
• Germany paying highest price to help euro zone
• Germany is biggest winner in monetary union

Below expectations of +3.2% y/y and lowest since Nov 2009

Core producer output prices+2.1% y/y (vs poll of +2.3%) lowest since Jan 2010

UK May inflation expectations for coming year  3.7% vs 3.5% in Feb

Cable slips to a day’s low around 1.5405 on the release.

I now have confirmation of some downside sell stops.

I am truly thrilled to advise that there are apparently some sell stops through……….big drum roll please…………. 1.2460 tara!!

We’re presently at 1.2475 from session low 1.2461.

• Eurozone inflation expected to remain  above 2% this year, but in line with ECB expectations
• Sees downside risks to the Eurozone
• EU crisis is an opportunity for greater financial solidarity
• Non- standard measures should be seen  together with fiscal measures
• Could create a eurozone banking union, but it will take time
• Economically the strongest EU countries are in the East

ITALY DATA: April SA industrial output -1.9% m/m, WDA -9.2% y/y, on
a contraction across all output sectors except for energy goods, posting
the worst fall in the y/y index since Nov 2009 (-9.3% y/y), ISTAT said.
–The m/m fall follows a gain of +0.6% in March and consecutive m/m
declines of -0.8% in February and -2.7% in January.
–April unadjusted y/y output worsened to -11.9% from -5.6% y/y in March
–There were 19 working days in April 2012 vs 20 in April 2011.

Reuters’ headline.

• Eurogroup conference call to take place on Saturday to discuss details – Two EU sources

The devil, as they say, is always in the details!!!

Recent lows of 0.9827 meeting some sovereign demand ahead of further bids down at 0.9800/10.

There’s talk now of some large  stops building on a break of 0.9800 from model accounts and CTA’s, and little in the way of support below until the 0.9710/20 area.

AUD’s trading around 0.9830

Demonstrably weaker than Reuter’s median forecast of -0.5%. Ughh

EUR/USD 1.2468 offered

I bloody warned you about those 1.2470/80 buy orders  didn’t  I  

Off around 60 pips from when i sat down this morning with noted selling from US and UK bank names behind the move. There’s some  reportedly decent bids down at 1.5400/10, likely sell stops just below, ahead of the 1.5374 lows of Wednesday.

Cable’s currently sitting at 1.5440

Answers on a postcard…….

EUR/USD wallows down at 1.2485, having been as low as 1.2481 after aforementioned sell stops tripped through 1.2490.

Talk of buy orders clustered down  at 1.2470/80.

Would I trust them? ie would I see them being durable enough to hold downside?  Not really    But then that’s just me.

Haven’t really got confirmation of sell stop orders below here, but I bet you a kings’ ransom they’ll be some gathered through 1.2440.

UPDATE:   As I was writing the above a little birdy chirped up and told me an ACB had just stepped in buying circa 1.2485 (hence the little blip up into the 90′s just now)

Still don’t really trust those bids though