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  • German PPI y/y -0.5% vs. -0.6% forecast & -0.8% previous; m/m +0.1% vs. -0.1% previous
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We had an extremely light economic calendar to start off the London session with only the German Producer Price index data.  It came off higher-than-expected and higher-than-previous reads, which could be taken as a positive for a European economy fighting off a deflation scenario.

We’re currently seeing a small bounce higher in euro against the majors.  EUR/USD is up 40 pips to 1.3560 after hitting last week’s lows in the Asia session, and the EUR/GBP is ticking higher is up as much as 20 pips to .8264 since the London open.

The U.S. dollar is also pulling back across the board, which is probably a reaction to China GDP early in the Asia session.  The better-than-expected y/y read of 7.7% vs. the 7.6% forecast is helping boost Asian currencies and commodity dollars, which possibly means a small outflow from the Greenback. AUD/USD has rallied since the start of this week’s trading, up 33 pips to .8810, and USD/CAD was down as much as 26 pips before stabilizing to its current levels around 1.0950.

The U.S. markets are closed today for the observance of Martin Luther King, Jr. day, an American activist who was best known for his work towards the advancement of civil rights. Liquidity will begin to thin out after the London session close, so expect erratic volatility, if much at all.

See also:

Asian Session Recap

U.S. Session Recap

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