Chinese Equities Losses Weigh Down Riskier Assets

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The Yen and Dollar gained against their riskier counterparts in today’s early trading after as the Shanghai Composite Index extended its losses since this year’s high to 20% reiterating concerns that the global economic recovery is stalling. The Yen rose against all 16 most-traded currencies, climbing to the strongest level in three weeks against the Dollar. The USD advanced against every currency except the JPY.

The EUR fell against 14 of the 16 most-active currencies after a government report showed German producer prices fell at the fastest pace in 60 years last month. The Pound extended its decline after the minutes of this month’s Bank of England (BOE) policy meeting showed several policymakers want to increase quantitative easing by more than the amount decided. The pound dropped to $1.6414, from $1.6561 yesterday, and was weakened to 86.01 pence per EUR, from 85.37 pence.

No major news releases are expected during NY market hours, therefore, equity movements are likely be the driving force behind currency movements throughout today. The release of U.S Crude Oil Inventories today at 14:30 GMT might help stabilize Oil prices above the $70 a barrel level as they are expected to show a decline in stockpiles