The US equity market is still playing the role of the leading indicator of the global markets at the current markets turmoil and credit crisis impact.

The grrenback has found strong support recently from the sell off in the equity market which seems mixed after last week volatility amid prolonged expectations of a global recession. The oil and comodities prices has come lower on these same expectaions which refer to a decline of demand globally but yesterday after the rally of the US equity market, the greenback has suffered across the broad as the current growing expectations of a big Fed's cut today to stimulate the economy and the stock market and the dampen the greenback attractiveness as well from both sides as a safe haven on the fed's accomodative step and the lower yield outlook of the greenback.

The japanese yen has had massive strong gains across the broad causing stromg crisizms from the japaneses as its negative impact on their exports especially versus the european competitive products as the current new records of the japanese yen appreciation versus their currencies which are contrarely negatively impacted by the the equity market slump and the weak risk apitite. The low cost of the japanese yen has made it the first funding currency of the carry trades transactions and very senstive to the movement in the equity markets which is the current mirror of the credit crisis and the markets leading indicator.

The gold trading was mixed and volatile recently as the liquidity problems is underpinning the greenback from a side and the risk aversion is giving support to the gold as a reserve from another side amid the current missing trust sentiment but the inflation outlook which is looking down because of the decline of commodities and energy prices or the recession can put weights on the gold which is not making it the best instrument to be bought at this current stance of growth slowing down which came accompanied with a lack of liquidity supporting the greenback but on the current market waiting for a considerable fed's cut, the gold could come over 750$ again fueled by the surge of oil and commodities prices gains after yesterday surge of the equity market which can increase the inflation outlook.

Best wishes

FX Consultant

Walid Salah El Din

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