FXStreet (Bali) - Martina Song, FX Strategist at Westpac, summarizes the action seen during Monday in the market, in which an attempt of recovery for riskier asset failed to garner as much momentum as one would have expected judging by the improved sentiment seen in Europe. Key Quotes The fall in crude prices to lows back to 2003 sent the mood for the London/NY sessions. WTI futures down to as low as $30.88 per barrel. Metals were also under pressure, spot iron ore falling around 2% to $42.31/tonne. Copper made fresh lows back to May 2009. AUD/USD continued on its recovery throughout the London morning, trading from 0.6960 up to highs of around 0.7035. The fall in oil prices dragged the Aussie back, the currency slipping to around 0.6985/90 early Sydney. NZD rose from 0.6520 to 0.6580 and was around 0.6555/60 in the Sydney morning. AUD/NZD is thus little changed at 1.0660 after touching 1.0700. EUR/USD fell from 1.0935 to 1.0850. USD/JPY had risen from 117.10 to just above 118.00 before almost completely retracing the move, falling with oil. A late NY/early Sydney bounce in equities saw the yen reverse and USD/JPY rise back to 117.75. USD/CAD probed 1.4250, trading with as 1.42 handle for the first time since 2003. USD/CNH tumbled throughout the London/NY sessions from around 6.6000 to 6.5840. This saw the CNY-CNH spread narrow dramatically. This would be the smallest divergence between the onshore and offshore currencies since early Nov. There was evidence of intervention in CNH as overnight CNH HIBOR yesterday hit a record high of 13.4%. With China’s currency leading sentiment for Asian markets, China’s fix will again be watched. After a series of higher USD/CNY mid rates early last week, the last two have been much lower than the CFETS close. The fixes have also been steadily lower relative to the previous days’. Thursday’s reference rate was the highest since 2011 at 6.5646, Friday’s was a little lower at 6.5636 and we saw 6.5626 on Monday. European bourses had managed a small rally before oil prices dragged equity indices back into the negative. Euro Stoxx closed -0.2%. The S&P 500 opened higher but immediately began to track lower. A late rally saw it rise to +0.1% into the close. US 10 year treasury yields rose from 2.11% to 2.18%. The Australian calendar remains low key. India Nov industrial production and Dec CPI are due. Japan returns from its long weekend. UK Nov IP is also out, and is expected unchanged m/m and up a stable 1.7%y/y. Soft global demand and the strong sterling are weighing on manufacturing. We also see the Dec NFIB small business optimism index. We will hear from the Fed, with Dallas Fed president Kaplan (non-voter) speaking in the Asia session and Vice Chair Fischer in Europe. There will be Q&A after both speeches. The US Q4 earnings reporting season begins. For more information, read our latest forex news.