Asian session: The yen and Swiss franc strengthened
29.07.2011, 08:22

Asian session: The yen and Swiss franc strengthened

Data:
05:00 Japan Housing starts (June) Y/Y 5.8%
05:00 Japan Construction orders (June) Y/Y 6.0%

The yen and Swiss franc strengthened toward records against the dollar after U.S. lawmakers delayed a vote on a plan to raise the debt limit to avert a default, boosting demand for refuge currencies.
The franc extended its sixth monthly gain, the longest in 17 years, after U.S. Representative Kevin McCarthy told reporters yesterday in Washington that there would be no House vote that day. 
The euro weakened for a third day against the dollar and the yen after Moody’s Investors Service said it may cut Spain’s credit rating. The 
Australian and New Zealand dollars declined as a slide in Asian stocks sapped demand for higher-yielding assets.
The dollar headed for a fourth weekly loss versus the yen before a government report today that economists said will show growth slowed last quarter.
Gross domestic product expanded 1.8 percent in the three months ended June 30, compared with 1.9 percent in the previous quarter, according to economists.

EUR/USD: the pair shown high in $1.4360 area then decreased.
GBP/USD: the pair  decreased in $1.6320  area.
USD/JPY: the pair decreased in  Y77.50 area.

The EMU flash HICP data for June at 0900GMT is expected to hold at 2.7% y/y.
US data starts with the much-awaited GDP data at 1230GMT, released along with the latest Employment Cost Index and ISM-NY Business Index. The advance estimate for second quarter GDP is for a 1.9% rate of growth, the same as in the previous quarter. PCE is expected to post a smaller increase than in the previous quarter, but stronger 
non-residential fixed investment and a smaller drag from trade and government spending should provide some offset. Residential investment is expected to again be a modest subtraction. The chain price index is forecast to rise 2.0% in the quarter, the same as in the first quarter. 
The Employment Cost Index is expected to rise 0.5% in second quarter after the 0.6% rise in the previous quarter.

Data continues at 1345GMT when the Chicago PMI is forecast to hold steady at 61.1 in July. At 1355GMT, the preliminary Michigan Sentiment Index is expected to revised up to a reading of 64.0 in July. 

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