Posts Tagged ‘ contraction ’

Dollar Strengthens as Risk Aversion Accelerates

A very quiet night of trade as the week comes to a close and the event risk calendar is virtually empty on both sides of the Atlantic. Risk aversion flows continued to weigh on high beta FX with Nikkei slipping nearly -2% in the wake of yesterday’s very weak US data than included a jump [ READ MORE ]

Risk Remains Bid, But US Data Key

Risk FX remained well bid on the first trading night of the week despite weaker Chinese PMI Manufacturing data that showed the first contraction in the index in 17 months. The HSBC Manufacturing gauge printed at 49.4 versus 50.4 the period prior. The official PMI reading issued on Sunday saw a more [ READ MORE ]

Weak Japanese Data Suggests Strong Yen Could Hurt Growth

Japanese data disappointed across the board tonight indicating that despite the pickup in global demand the country’s economy remains mired in a deflationary spiral that could weigh on growth in 2010. Japanese household spending declined by -0.7% versus forecast of a 2.5% rise contracting significantly from last month’s 4.4% increase. After six consecutive months of [ READ MORE ]

RBA Takes Rates to 4.25%. Will it Continue to Tighten?

For the fifth time since October of 2009 the Reserve Bank of Australia raised its benchmark rates to 4.25% – the highest level in G-20. In its post announcement communiqué the RBA stated,” With the risk of serious economic contraction in Australia having passed some time ago, the Board has been lessening the degree of [ READ MORE ]

Weak German Trade Weighs on Euro

German Trade Balance printed much worse than expected at 8.7B versus 16.4B forecasts as exports slid by -6.30%. This was the weakest reading since the March of 2009 when the global economy was in the throes of its worst contraction in post war period. The news was especially surprising given the decline in the EUR/USD [ READ MORE ]

Dollar: Retail Sales Could Trigger Breakouts

It has been an extremely quiet day in the foreign exchange market with currency pairs such as the EUR/USD and USD/JPY confined within a 50 pip trading range. This contraction in volatility has been occurring in the EUR/USD for the past few weeks and signals that a breakout is imminent – tomorrow’s U.S. retail [ READ MORE ]

Japanese Data Provides No Clear Direction for the Yen

Japan produced a set of mixed economic data on the last trading nigh of the week showing that the world’s third ;largest economy continues to recover from the worst contraction in the post war era albeit an uneven pace. Japanese labor markets improved with the unemployment rate declining to 5.1% versus [ READ MORE ]

IFO Improves Modestly But EUR/USD Unimpressed

The IFO survey of business sentiment printed in line with expectations at 94.7 vs. 96.6 projected and a bit better that the 93.9 reading the month prior. The latest results were the highest level since September 2008 just before the Lehman bankruptcy sent global capital markets into a tailspin and usher in the worst business [ READ MORE ]

UK GDP Still weak – Will Pound Hold Its Gains?

UK GDP data for Q3 was revised upward from -0.4% to -0.3% which was an improvement from the shockingly low figure the market saw originally but a disappointment to cable bulls who were hoping for a stronger reading this time. The breakdown showed that private consumption was flat, government spending rose 0.2%, investment declined -0.3% [ READ MORE ]

Has Euro Topped at 1.5000?

Risk FX staged a short covering rally at the start of early morning European trade today, but the move stalled in the wake of weaker than expected EZ GDP data for Q3. EZ GDP printed at 0.4% vs. 0.6% eyed while German GDP data came in at 0.7% vs. 0.8% forecast. This [ READ MORE ]

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