Forex News: Markets reacted with relief in some cases, but also a fair amount of caution, to supportive statements from Treasury, White House and Fed on health of Freddie Mac and Fannie Mae (with those two putting out statements of own); Treasury to seek approval from Congress for temporary increase in long-standing line of credit for two GSEs, Fed offering to lend money directly to firms at discount rate. USD gained vs EUR, JPY, CHF and others on news, but only mildly, and has now retraced somewhat; USD/JPY at 106.54 vs 106.71 earlier, EUR/USD at 1.5885 vs 1.5866, EUR/JPY at 169.21. U.S. Treasurys fell on supply-related concerns but JGBs have been mixed. U.S. stock futures point to higher open on Wall Street, though Asian bourses have fallen: Nikkei off 0.2%, Kospi off 0.6%, HSI off 1.3%, Taiwan shares off 1.2%. All eyes on how Wall Street fares at open, plus how Freddie goes with $3 billion scheduled sale of bills (Asian central banks are big holders of agency debt but fund manager says Japanese investors unlikely to have strong demand for Freddie's 3-, 6-month paper).
Japan Finance Minister Nukaga said he hoped steps being taken by U.S. would help restore health of that economy. Nymex crude oil down 33 cents after initial $2.50-plus drop, spot gold flat. Asia CDS tightened with Markit iTraxx Asia ex-Japan high-yield index in around 20 bps at 540. Not much other data or news: NZD/USD though hit by downbeat NZ May retail sales data amid sharp decline in car sales; retail sales down 1.2% vs forecast flat outcome, while core sales +0.7% vs 0.5% rise tipped. NZD dropped near 0.7568 at one point. Pakistan shares down 4.4% after capital markets regulator Friday reversed decision to disallow short selling of securities, reinstated upper and lower circuit limit of 5%
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