Asia Session – February 10, 2012 1:47 AM
February 10, 2012
The RBA cut
its growth and inflation forecasts for 2012 as uncertainty surrounding economic
conditions offshore flow into the domestic economy. On Tuesday, the bank
decided to keep interest rates at 4.25%, surprising a market that was looking
for a 0.25% cut, however this recent report is more dovish than expected which
means economists might get there cut next month.
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New York Session – February 9, 2012 4:18 PM
February 9, 2012
Sentiment was moderately higher after Greek leaders agreed on an austerity package ahead of a meeting between EU finance ministers. The dollar is mostly weaker against the majors with the exception of the JPY, AUD, and NZD as stocks and Treasury yields advance. Key central banks made policy announcements this morning with the Bank of England maintain rates at 0.50% and expanding its asset purchase target by 50B£ to 325B£ as expected while the European Central Bank kept rates on hold at 1.00% as expected. Full text »
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Britain Expands Quantitative Easing By 50 Billion Pounds
February 9, 2012
Sterling higher in forex trading
Sterling is higher in forex trading today as Britain expands its quantitative easing program. The move has been widely expected, since the British economy remains stuck. The move is supposed to help prompt stimulus.
UK pound is also getting a boost from general risk appetite today. Normally, such easing would put the pound lower against the US dollar, but there is a great deal of optimism now that a Greek debt deal has been hammered out. High beta currencies are doing well today.
Pound is down against the euro, though. While it has had some success against the US dollar today, nearly all the currencies are making way for a jubilant euro. With a Greek deal done, the country won’t default, since it will have the help of ECB and IMF bailout funds.
See Also
- Sterling in Forex Trading
Currency trading news
US Jobless Claims Drop
February 9, 2012
US dollar index lower on better news
US dollar index is lower today, dropping as forex traders look for higher yields instead of safety. Greenback is not being used as a safe haven, since forex traders are interested in the high beta currencies.
US jobless claims dropped by 15,000, and lower unemployment persists. This is good news for the US economy, since it means that fewer people are losing their jobs. The good news has investors favoring currencies besides the US dollar.
Additionally, higher gold prices are exerting downward pressure on the greenback, sending it lower on the currency market. The good news is likely to keep the US dollar lower for quite some time.
See Also
- Economic News and the US Dollar
Greenback on the currency market
Asia Session – February 9, 2012 1:45 AM
February 9, 2012
Mid-way
through the session Chinese CPI data printed much higher than expected, leading
to concerns that Beijing won’t move to loosen policy. The official CPI print
was +4.5%y/y, with food prices leading the drive with a 10.5%y/y gain. At the
same time, data showed that producer prices increased 0.7%y/y, which represents
a deceleration from December figure of 1.7%.
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New York Session – February 8, 2012 4:13 PM
February 8, 2012
The buck traded slightly firmer today but remains vulnerable to event risk ahead of key central bank meetings tomorrow and as details emerge regarding a Greek debt and austerity deal. The USD is also showing technical signs of weakness as the Dollar Index trades below the 100-day sma. It was a relatively quiet day in the FX markets as prices consolidated ahead of tomorrow’s BoE and ECB meetings. There was little economic data released out of North America with the only data of note being weekly U.S. MBA mortgage applications which rose 7.5% (prior -2.9%) and Canada’s January housing starts which declined slightly to 197.9k from the prior 199.9k. The Loonie is weaker with USD/CAD retesting the 200-day SMA as resistance. Full text »
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ECB Expected to Remains on Hold while BOE Eases
February 8, 2012
Sterling could drop in forex trading
Tomorrow, both the ECB and the BOE are expected to make interest rate and monetary policy announcements. The ECB is expected to remain steady, and the BOE is expected to increase its asset purchase program.
Kathy Lien offers a look at a comparison between the economies of the eurozone and Great Britain. It becomes clear that in Britain things are still struggling along, and, as a result, policymakers at the BOE want to inject more cash into the situation.
The forex trading forecast for the sterling, then, is likely to point lower. Indeed, today the sterling remains down against the US dollar, even though the euro has largely recovered its earlier losses. This is likely to be a forecast of the future, in which more easing will send the sterling lower.
See Also
- Sterling in Forex Trading
Forex trading forecast
Euro Heads Higher in Forex Trading
February 8, 2012
Choppy trading on the currency market
Euro is heading higher in forex trading right now, recapturing some of the gains it lost earlier. It’s been a choppy day for the currency market. Earlier, the euro saw gains as optimism over Greece took hold. Then, those gains were pared as the optimism faded. Now, though, there is enough hope again to help the euro.
It’s been an interesting day as forex traders and others wait to see what kind of help the European Central Bank will offer Greece, and what measures Greek leaders will accept.
For now, euro is higher in forex trading. It has edge out the US dollar and is looking for some gains. However, a slight change in sentiment, or the smallest hint of bad news, could overset the gains and send the euro lower against the US dollar again.
See Also
- Euro in Forex Trading
Currency market news
Asia Session – February 8, 2012 1:19 AM
February 8, 2012
It was a fairly quiet day on the FX front, but a slew of
earnings announcements kept equity investors on their toes. Before the open,
BHP surprised the market by announcing a drop in first-half profits of 5.5%,
causing the stock to slide around 0.6%. In Japan, Toyota shares were lifted
after the company upgraded its fiscal-year earnings outlook.
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New York Session – February 7, 2012 4:17 PM
February 7, 2012
The buck reversed earlier gains after Bernanke downplayed recent labor data and the euro rose amid hopes that Greek debt and austerity negotiations are in the final stages. With no top tier economic data released out of the U.S., it was headlines once again that drove price action. Fed Chairman Ben Bernanke testified before the Senate Budget Committee and cautioned that the current unemployment rate “no doubt understates the weakness of the labor market”, noting the reduction in the labor force due to those that are discouraged. The dovish comments boosted market sentiment as it was interpreted that further accommodation is still under consideration (See more in our Fundamental Update: The Beveridge Curve and Bernanke’s comments). The prospect of QE3 put pressure on the US dollar with the greenback declining against all of the G10 currencies except for the yen. Full text »
