[ForexNews]

USD is lower as the NY trading session gets going, with familiar risk-positive dynamics strengthening much of G10 across the board. Gold is approaching new highs as well, adding to the USD-negative momentum. A variety of G10 central bank developments hit the tapes, but the key driver for risk appetite for now is likely the slew of data during the London session (and a decent China PMI reading), along with concerns from Dubai continuing to recede.

EUR-USD has moved towards 1.5080. The data flow, including better than expected EuroZone manufacturing PMI and a surprising drop in German November unemployment has raised hopes for better near-term macro recovery in Europe. We also had Swiss economic data that were either as expected or better. Cable did have a slight breather to gains after a softer-than-expected PMI figure.

Overnight II, central banks: RBA (expected) and BOJ (unexpected)
G10 central banks also made news, although only the RBA was as expected. They hiked rates 25bp to 3.75%, despite shifting market views that the RBA could well have stayed on hold. Moreover, market economists continue to expect the RBA to hike again in February and March, taking the target to 4.25%. The impact on AUD was transitory and the currency did not really produce any gains until the general risk rally pushed up the Dollar Bloc across the board. Meanwhile, the BOJ had an unscheduled meeting, with USD-JPY up over a big figure. But the cross unwound much of that move (now around 86.80-levels) after the BOJ announced a boost in liquidity provisions (offering JPY10tr in 3-month financing) and kept the rate on hold at 0.10%. Although the move does reflect continued easing in monetary policy, markets were likely expecting more dramatic action, and ultimately the decision does not do anything to change expectations of near-term JPY strength.