Risk on, Risk off, back in the middle -.......>

FOREX: Risk on, Risk off, back in the middle

- Risk-off spilled over into the NY session on Friday, JPY crosses sharply

retraced European morning gains before pausing to settle mid-range.

- USDJPY extended its corrective pullback to Y110.32 with the 100 & 200-dma's

now within target at Y109.93/90. The dollar index challenged weekly lows at

96.14, gold failed to convincingly clear $1180, later settling around $1177.05.

- EURUSD struggled to build above $1.1420, suggesting the downside remains

intact. Bulls need a close above $1.1433 to stabilise the near-term outlook and

retest broken neckline support at $1.1500.

- CAD sits top of the G10 pile with gains of 0.50%. Canadian CPI came in well

above forecasts at 3.0% y/y, its highest levels seen since Sep 2011. USDCAD

dipped back under C$1.31 to react lows of C$1.3065. Daily cloud base remains the

near-term support area at C$1.3058.

- EM FX remained defensive led by USDTRY's 50 big fig move to Try6.3468.

Position squaring ahead of the weekend and scheduled review by S&P were

attributed to the move. BRL, CLP & ARS all registered modest losses.