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IMM currency

futures stronger

CHICAGO: IMM currency futures on Thursday ended stronger after afternoon trade had calmed from a busy morning.

"There was something for the bulls and the bears," said one bank trader of the morning's seesaw movements.

Subdued range-trading, which replaced early gyrations, was enlivened by the Canadian dollar, where traders said a Japanese bank bought 300 September futures and hit buystops.

The market by then appeared to have decided that the Bundesbank's half-point reductions in its discount and Lombard rates might be the last cuts in official German rates even though the overnight rate still could slip.

But US data released on Thursday also suggested the key US rates have room to decline, which mitigated the impact of the German easing, economists and analysts said.

"People are discounting the (German) discount rate cut somewhat," said Paul Kasriel, monetary economist, Northern Trust Bank. "I think people are beginning to entertain thoughts of Fed easing in the next several months."

Kasriel called Thursday's unexpectedly weak durable goods orders for July, which fell 1.7 percent and lost 1.6 percent without defense, a "little bit of a wakeup call" that suggested the US economy is not recovering at a robust rate.

Traders had expected durable goods orders, often a volatile figure, to rise 0.8 percent and gain 0.6 percent without defense.

Kasriel also noted a stronger gain than anticipated in weekly jobless claims, which rose 10,000 to 348,000, plus a 4.1-percent drop in volume in the Mortgage Bankers Association's latest weekly mortgage application survey, as bolstering ideas the Fed might see reasons for further easing.

Technicals also aided currencies, especially after September marks bounced back up after approaching psychological support near $0.6674, or about 1.50 spot.

At the end of pit trading, September yen rose $0.000021 to $0.010391, marks gained $0.0029 to $0.6777, Swiss francs added $0.0044 to $0.8210, Sterling gained $0.0022 to $1.5430, Canadian dollar rose $0.0029 to $07390, and the Australian dollar firmed $0.0001 to $0.7397.-Reuter