FOREXYARD: Forex News Blog | |
- US Political Gridlock Carries Over to the Fed
- Sentix Report Shows Investor Confidence Shrinking
- Asian Session Sees Low Trading Volume
- US Hourly Earnings Data Offering Silver Lining?
- Australian Employment Advertising Down in May
- Interest Rates, Sovereign Debt, and Event Risk
- Inflation Pressures Remain on ECB Radar
| US Political Gridlock Carries Over to the Fed Posted: 06 Jun 2011 06:20 AM PDT
Much has been made of the heavy hitting political games that Democrats and Republicans have been playing in order to increase the debt ceiling and to reduce the fiscal deficit. The latest victim of the political gridlock is MIT Professor and Nobel Prize winning economist Peter Diamond. Diamond was nominated by President Obama to fill one of two empty seats on the Federal Reserve Board of Governors. Yesterday Diamond withdrew his nomination after questions arose regarding the relevance of his background and his experience in crisis management. Diamond is an employment and behavioral economist. His appointment was opposed by Republicans last week. In response, Diamond penned an op-ed piece in the New York Times over his disappointment of the Senate Banking Committee and the confirmation process. Read more forex trading news on our forex blog. |
| Sentix Report Shows Investor Confidence Shrinking Posted: 06 Jun 2011 05:53 AM PDT
The Sentix Investor Confidence report which was published this morning revealed an unsurprising downturn in sentiment among large investors and market analysts. The report is a diffusion index based on survey responses from these two groups in Europe. Given the significant downturn in market fundamentals since early May, this report had almost zero impact on today's trading as it was largely assumed such a reading was impending. Traders have nonetheless digested this information and moved slightly more in the direction of safe-haven assets. Read more forex trading news on our forex blog. |
| Asian Session Sees Low Trading Volume Posted: 06 Jun 2011 05:49 AM PDT
This morning's Asian trading session was lighter in volume than the past several weeks due to a handful of bank holidays. Forex traders saw very little market movement at today's open despite the prevalence of major news ending last Friday. Of today's bank holiday list, China's observance of Dragon Boat Day marks the most significant absence from the economic calendar. New Zealand's celebration of the Queen's birthday also had the Pacific island economy missing from this morning's liquidity. Both economies will be back online tomorrow. Read more forex trading news on our forex blog. |
| US Hourly Earnings Data Offering Silver Lining? Posted: 06 Jun 2011 05:39 AM PDT
Though last Friday's non-farm payroll (NFP) data showed remarkable stagnation in the US jobs sector, the news that average hourly earnings went up beyond expectations has at least a few analysts looking into whether the jobs data has a silver lining. The report, released by the Bureau of Labor Statistics last Friday, has a correlation to positive inflation and growth. It acts as a leading indicator of consumer spending as higher incomes tend to pass on to growth in retail sales and consumer sentiment. Whether this is enough to offset the slow job growth is something worth watching as the days progress. Read more forex trading news on our forex blog. |
| Australian Employment Advertising Down in May Posted: 06 Jun 2011 05:29 AM PDT
The Australian and New Zealand Banking Group (ANZ) published its report on job advertisements in Australia this morning. The figure revealed a 6.5% downturn in job ads for the month of May, but the Aussie (AUD) appears no worse for wear. The strength of the Australian dollar has so far felt little challenge these past several trading days as investors keep their focus on debt news out of Europe and employment data out of the United States. While the news may pull down on the Aussie this week, so far traders appear ready to continue buying, albeit hesitantly. Read more forex trading news on our forex blog. |
| Interest Rates, Sovereign Debt, and Event Risk Posted: 06 Jun 2011 05:12 AM PDT
This week's trading is highlighted by a mix of potential monetary policy moves and sovereign debt risks. The dollar bloc central banks of Australia and New Zealand are due to meet this week. The former (RBA) is expected to keep interest rates on hold but may perhaps surprise the market with a signal to increase rates in the near term. The latter (RBNZ) is forecasted to hold rates steady and not signal any near term changes to monetary policy. On Wednesday both the Bank of England (BoE) and the European Central Bank (ECB) will hold their respective press conferences. The BOE will not be making any adjustment to the interest rate nor to the Asset Purchase Facility as the central bank will most likely attempt to delay raising interest rates as long as possible in order to aid the ailing British economy. On the opposite side of the spectrum ECB President Trichet will likely signal a rate increase to come in the following month. This event will most likely be the highlight of the trading week event risk runs high. Traders should remember the March 5th ECB press conference where Trichet failed to use the expected wording and the EUR/USD began to unwind from its 17-month high. The interest rate story will be the headline event but the European sovereign debt crisis has only temporarily been put on the back burner at many of the major forex trading desks. While a temporary deal looks to have been cut between the EU/IMF and Greece in order to stave off a default in July, the parties continue to negotiate a potential restructuring of Greek sovereign debt. The political winds have shifted in Portugal as the incumbent party looks now to form a political coalition. This development has Portuguese sovereign debt yields easing from highs last week. Turning to the US, last week's dismal non-farm jobs report and increased unemployment rate underscores how slow the US economic recovery is progressing. Talk of QEIII was in most of the major financial newspapers over the weekend as economists and talking heads weigh the odds given the political headwinds the US faces going into an election year and the flack the Fed took with QEII. Moody's note last week warning on the US debt rating also puts increased pressure on the President and Congress to come up with a potential solution to the deficit. Read more forex trading news on our forex blog. |
| Inflation Pressures Remain on ECB Radar Posted: 06 Jun 2011 12:49 AM PDT
Euro zone PPI data may show continued inflationary pressures in the euro zone as the market shifts its attention from the Greek sovereign debt crisis to the upcoming ECB policy meeting. Today's Economic Data Releases: EUR – PPI m/m – 09:00 GMT CAD – Ivey PMI – 14:00 GMT Read more forex trading news on our forex blog. |
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