The dollar index fell to a fresh five-month low in Asian trading, but not on the back of the EUR/USD which consolidated recent gains around 1.3800, failing to revisit the late NY highs of 1.3830. Cable led the fresh pressure on the USD, rising above 1.5800 to trigger stops and trade to highs of 1.5818. The sterling move boosted other Commonwealth currencies with CAD, AUD and NZD rising but unable to push through Wednesday’s highs. USD/JPY was pressured by yet another round of JPY cross sales from Japanese life companies and from model funds, with the fall in the Nikkei over 1% helping to weigh on the currency. Asian stock markets were broadly lower with the Nikkei pressured by exporter weakness due to JPY strength while growing doubts over China’s recovery weighed on Shanghai. U.S. Treasury yields opened lower, after losses in NY on the FOMC minutes showing Fed interest to buy more treasuries. Oil eased below $62 after reaching a six-month high Wednesday but gold continued to rally on the dollar weakness.
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