...But did traders pick the wrong currency to sell? Tonight's prompt sell off in the Euro is now being attributed to comments by Banque de France Governor Christian Noyer who said monetary easing creates the potential for global imbalances. While it is true that Noyer stated that The European Central Bank will keep its emergency measures as long as needed, this is not news. Obviously all of Europe is now reliant solely on the ECB's bidding of last resort for each and every failed bond auction and to prevent bond routs in the secondary market. Again: this is not news. Yet what is interesting is that instead of selling off the EUR, traders may have picked the wrong currency. To wit: Noyer was actually blasting the pegged CNY, which means that the CNY-derivative currencies, the AUD and the NZD should have taken the brunt of tonight's action, and in the wrong direction at that. And, ultimately, the target was the USD. The moment this became clear (9pm Eastern) is when gold took off.
*NOYER: MORE FLEXIBLE YUAN WILL HELP IT PLAY BIGGER WORLD ROLE
*NOYER SAYS YUAN ISSUE WON'T BE RESOLVED RIGHT AWAY
*NOYER SAYS CURRENCY, COMMODITY, CAPITAL-FLOW VOLATILITY RISING
*NOYER SAYS NATIONS CHALLENGING EACH OTHERS' POLICY NOT GOOD
*NOYER URGES DE-LINKING RESERVES GROWTH, EXCHANGE-RATE POLICY
*NOYER URGES EFFORT TO ADDRESS GLOBAL CAPITAL FLOW VOLATITILITY
*NOYER SAYS MONETARY EASING CREATES POTENTIAL FOR IMBALANCES
*NOYER SEES DOUBT ON CONSISTENCY OF MAJOR ECONOMIES' STRATEGIES
*NOYER: SOME VOLATILITY MAY BE INDUCED BY OFFICIALS' POLICIES
In other words, Noyer indirectly attempted to push the EURUSD. And failed... Was that the extent of Europe's intervention for the evening?