USD traded softer to start the week as US stock prices tumbled and despite better than expected housing sales data, though a late squeeze trimmed losses and London's holiday of course ensured poor liquidity. Financial stocks were mostly weak but with some striking exceptions. Lehman Bros sat 5% lower in late trade after Korea's Financial Services Commission said a state-owned institution such as KDB should be cautious about foreign acquisitions. The failure of another small bank, Kansas-based Columbian Bank, also unnerved investors. But the GSEs posted gains well over 10% in the final hour on Wall St. The New Zealand dollar was rebuffed several times around 0.7090 and then looked soggy around 0.7040/45.
AUD/USD extended its late Asia bounce as far as 0.8690 amid broad USD selling but retreated to 0.8630/35.
EUR/USD rallied through 1.4800 on several occasions but could not extend, slipping to a more comfortable 1.4750.
USD/JPY set a firmer direction than other major pairs, sliding from near 110.00 in London to as low as 109.05 and recovering only modestly thereafter.