Asia Session – August 1, 2011 12:24 AM

July 31, 2011

Quiet a busy beginning to the trade week today, with the status of the US debt ceiling bill the prime mover of markets here in Asia. The US Dollar opened firmer as reports surfaced from the US government that a new debt reduction bill was set to be voted upon at 6pm (EST) today with the default deadline looming within 48 hours. The gaps on the open were substantial, with USD/JPY opening about 50 pips higher near 77.25, EUR/USD opening almost 25 lower near 1.4375, and EUR/JPY shooting about 40 pips higher from its 110.55 close on Friday. From there, the FX markets were jumpy and thin as conflicting rumors emerged about the status of US debt ceiling talks and possible votes. Full text »

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London Session – July 29, 2011 6:21 AM

July 29, 2011

Growth and Politics dominate markets Full text »

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Asia Session – July 29, 2011 1:49 AM

July 29, 2011

Weary markets waited in anticipation of a debt ceiling vote in the US House of Representatives that never came, helping to further weaken a hobbled US dollar. With the August 2nd “do or die” date for a new debt ceiling looming, House Republicans postponed a 6pm (EST) vote for later in the evening, but that vote was cancelled when it seemed that the plan would not get the support needed to pass it on to the Senate. While it was generally assumed that the US Senate would quickly kill the bill, it would then open the door for an 11th hour compromise that could possibly squeak out a deal before the deadline. Full text »

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Risk Aversion Sets in on Debt Ceiling Worries

July 28, 2011

Forex traders look for safe havens

Risk aversion is the name of the game today in forex trading. Forex traders are looking for ways to find safe haven, and that means that the U.S. dollar is inching higher — in spite of worries surrounding the debt ceiling debate.

There still appears to be no compromise in sight as rivals in the U.S. Congress present their own plans. With the House and the Senate controlled by different political parties, a debt ceiling agreement seems far off, and the deadline is fast approaching.

For now, that means that forex traders will look for safe haven in currency trading. However, things could change quickly if the U.S. begins defaulting and the credit rating is downgraded. The greenback may no longer be a safe haven when this weekend is over. 

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New Zealand Dollar Drops Against U.S. Dollar in Forex Trading

July 28, 2011

Kiwi in currency trading

The New Zealand dollar is lower today in forex trading after expectations of a higher rate were crushed. The central bank in New Zealand decided to keep the interest rate the same, and gave no indication that any sort of rate hike is coming in the future.

The news is disappointing forex traders, and the U.S. dollar is gaining against the kiwi in currency trading as a result. Without a higher yield, traders are looking for other options.

Also weighing on the New Zealand dollar in forex trading is general risk aversion. Concerns about the debt ceiling are overwhelming other economic news around the world as the globe focuses on what’s next for U.S. debt

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London Session – July 28, 2011 7:01 AM

July 28, 2011

Debt jitters hits markets Full text »

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Asia Session – July 28, 2011 1:47 AM

July 28, 2011

Overall, we had a pretty peaceful session in Asia as many traders are not interested in deciphering which currency, the Euro or the Dollar is the lesser of two evils. Earlier contagion fears sprung up again in the Euro Zone earlier as Italian bond yields again headed higher. This in conjunction with comments out of Germany that the Greek economy would take almost 10 years to normalize did not entice Euro buyers. Conversely, the August 2nd debt ceiling deadline is one day closer and the clashing parties in the US government are still engaged in a classic Mexican standoff. With all that stated, the EUR/USD cruised sideways with a single pitfall that kept it within a 50 pip range. Thus we turn our attention to the early action out of New Zealand… Full text »

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New York Session – July 27, 2011 4:03 PM

July 27, 2011

The greenback was firmer across the board with the exception of the Australian dollar, which was boosted by the overnight release of stronger than expected inflation data. AUD/USD saw new record highs of around 1.1080 and has since corrected to current levels of around 1.1000. The euro was lower following comments from German Finance Minister Schaeuble which indicated Germany’s opposition to allowing a ‘blank check’ for the EFSF to purchase bonds in the secondary market. EUR/USD plunged to current levels of around 1.4360/65. Full text »

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Australian Dollar Builds Strength in Forex Trading

July 27, 2011

Aussie gains in currency trading on the FX market

The Australian dollar is building strength in forex trading today, gaining as gold prices provide some support, and as other economic data help out.

Aussie is seeing success in currency trading today, heading higher against major currencies including the euro, pound and U.S. dollar. The Aussie is also doing well against the New Zealand dollar.

Australian dollar often receives support from gold prices, and gold is gaining once again. News that U.S. lawmakers are no closer to a debt ceiling agreement, along with the very real possibility of a credit rating downgrade, are contributing to higher gold prices — and providing support for the Aussie.

Other than that, though, the U.S. dollar is higher against other major currencies. Aussie is the only currency having real success against the U.S. dollar today.

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Will the U.S. See a Credit Downgrade — Even if Default is Avoided?

July 27, 2011

U.S. dollar a little higher today in forex trading

There is some speculation that a U.S. credit downgrade is inevitable — even if a debt default is avoided. Concerns about how credit ratings agencies are likely to react to what’s next for the U.S. debt ceiling are weighing on markets.

However, the worries about the U.S. credit rating aren’t impacting the U.S. dollar much in forex trading. Today, the dollar is mostly higher, gaining against the euro and the pound. Many believe that the U.S. won’t actually default on its debt, so the prospect of a lower credit rating isn’t as scary as it could be.

The real concern that some have is the possibility that the U.S. will be in this same position in a few more months. If the budget isn’t brought under control, and if the debt ceiling isn’t raised sufficiently, these problems are likely to repeat themselves quite soon. 

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