NEWS HOTS 8 JANUARY 2007

Still plenty of talk of sovereign related demand on the base of EUR/USD, though the latest pop higher looks to be down to an investment bank but order rather than a lack of patience among the reserve adjusters. There's also an element - again - of catch up with Cable, with 15.00gmt fixing demand having a greater impact than the much better advertised interests at 11.00gmt had

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EUR/USD again was starting to look a little 'wobbly' though it has been this sort of level (just below 1.3000) where there have been suggestions of official interest. The name mentioned last week was not a sovereign, but a European supranational, though a UK clearer also appeared to have some pretty solid demand, having been on the other side as the new-year started. Currently, a small bounce, but this appears to be directly related to a large Swiss name buying EUR/CHF rather than for any other reason!

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ECB's Trichet - comments at G10 central bankers a touch hawkish

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JPY CB PREVIEW: Jan 18 meeting - BoJ might hike, but better to wait and see

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08 Jan 07: 06:52(SGA) - FX NOW! USD/JPY, EUR/JPY Flows : JPY firms, EUR/JPY under pressure, eye Trichet, Fukui (CB)
JPY seen ending Asia and starting Europe on a firmer not, with USD/JPY falling to day lows of 118.222 and EUR/JPY at day lows and also 3-week lows of 153.75-80. Market players will are cautious of more downside in EUR/JPY, with stoploss orders seen on break of 153.50, and with NZD/JPY, AUD/JPY, GBP/JPY all under selling pressure. Focus on any comments from BoJ Governor Toshihiko Fukui at BIS/G10 meeting in Basel, with ECB President Jean-Claude Trichet comments at 1145GMT for any clues on ECB bias. USD/JPY bids at 117.90-00, stops 117.80.

sorry late post

* 08 Jan 07: 08:39(LDN) - FX NOW! GBP/USD, EUR/USD Flows- sovereigns or not, Cable may be better short term bet
The jury is out as to whether there is any current sovereign support for EUR/USD, the picture not helped by many banks with central bank desks having arrangements to buy varying amount of EUR at different levels and effectively keeping the end buyer name out of the market. Anyone looking for a floor might prefer to look at Cable, which should see demand for a clearing bank fixing on dividend payments this morning . PB