France's loss of Triple A slightly dented the euro exchange rate, which nonetheless remains close to 1,28. On equity markets, yesterday's strong advance led, as expected, to a pause: the MSCI Asia Pacific regional index, which at 12,35 (Tokyo time) marked a progress of 0,5%, it is giving away at least part of the gain. Tuttavia, news on the real US economy continues to be positive, especially as regards the real estate sector, whose 'healing' is a precondition for recovery.
Returning to the currency field, the Chinese currency remains close to the record levels reached (6,22 against the dollar) on November 14th. And we note a gap between the hitherto correlated trends of the Asian and South American currencies. The excellent performance of the yuan and won is matched by the weakness of the Brazilian real and the Mexican peso (which, however, had appreciated much earlier). Gold is trending higher, as it always does when the likelihood of stimulus increases (the narrow-minded assumption is that stimulus drives up inflation and boosts safe-haven purchases like gold). Oil at $89/bbl continues to reflect fears and tremors related to Gaza and the Middle East.
