[ForexNews]

On days like this, with US equity markets open and the bond market closed it is easier to see that the fixed income market really is the "dog" and the equity market merely the "tail." With drama today coming from the Senate Banking Committee's Chairman Dodd of Connecticut it would be helpful to see the bond market response. The Financial Times headline above the fold has "Banks bill seeks to strip Fed of powers." Definitely a bid for volatility. The VIX has traced out a key reversal.

The China news was all good last night (see attached) with 29.4% growth in M2 a leading factor in a widely expected upturn in CPI (see graph page 2). Chinese holidays underpinned retail sales +16.2% y/y but the number is expected to settle back toward a 15.5% rate. Risk on.

Headlines:
US Tsy Sec Geithner deeply believes a strong dollar is very important to the US

WB's Zoellick: USD 's reserve ccy status secure for some time, Gold not as transferable

Fed Fisher: USD depreciation not disorderly but watching carry trades for disorderly influence

Fed Fisher: Current low rate stance appropriate given prospects of sub-optimal growth

Fed Lacker: US in pretty good shape, looking at sustained growth on when to raise rates

Fed Yellen: Commercial real estate will continue posing headwinds to US's econ recovery

Equities higher overnight with Europe up over 1.2%

Gold hitting new highs at 1115 and Oil knocking on the door of $80 a bbl

Aust Nov consumer sentiment falls by a modest 2.5% after RBA's follow up Nov rate hike

RBNZ Bollard: High NZD not sustainable, NZD is over valued and its strength disappointing

NZ's outlook has improved but high NZD may hinder improvements: RBNZ Financial rpt

NZ food prices slump by 1.5% over Oct, largest fall in 3.5yrs

WB's Zoellick: Internationalised Yuan can become an alternative reserve ccy in 20yrs time

ADB's Kuroda says Asia experiencing V shaped recovery; calls for more Yuan flexibility

APEC ministers pledge to keep economic stimulus measures per draft

S Korea Oct unemployment rate falls for 2nd mth to 9mth low of 3.4% vs 3.6% prior

BOE Inflation Report: sees CPI below target in 2 years, risks balanced

BOE King: Need to rebalance to exports away from imports, weaker stg will help

BOE King: We have a completely open mind on whether we will do more asset purchases

Japan Furukawa: Carefully watching long term interest rate moves

Brazil triggers talk of action to curb real - FT Article