FOREXYARD: Forex News Blog | |
- US GDP Growth on Track
- US Durable Goods Reports Cause Mixed Reactions
- Italy Reports Unexpected Growth in Retail Sales
- Germany’s Business Climate Rated Higher than Forecasts
- Euro Trades Back and Forth after Italian Bank Warning
- Greek Risks Drag Markets Lower
| Posted: 24 Jun 2011 06:38 AM PDT
This afternoon's publication of the US's final gross domestic product (GDP) and GDP Price Index suggests that forecasts for both are largely on track. While digesting news about durable goods orders and assessing risk sensitivity, many investors found in today's GDP reports an added reason for optimism ahead of this week's close. Considering the marked decline in manufacturing across the US and Europe, and factoring in expectations for a weak second quarter, the spot on growth forecast of approximately 2% for US GDP may in fact help several investors choose risk over caution in the next week or two, helping the ailing economies of the Western world make a modicum of gains going into the early summer months. Read more forex trading news on our forex blog. |
| US Durable Goods Reports Cause Mixed Reactions Posted: 24 Jun 2011 06:35 AM PDT
This afternoon's early reports from the US regarding its durable goods orders for June gave some cause for consternation. On the one hand, both the nominal and core reports underlined growth from the previous month's steep declines. On the other hand, the more impactful core report came in below forecasts. While it is true that the nominal report showed growth in durable goods orders well beyond forecasts (a hearty 1.9% growth), the core report, which factors out the more volatile transportation items, revealed stagnation in other sectors of durable goods orders. The murky growth of only 0.6%, below the 1.0% expected, furrowed more than a couple eyebrows as traders assessed the level of risk appetite in the American markets. Read more forex trading news on our forex blog. |
| Italy Reports Unexpected Growth in Retail Sales Posted: 24 Jun 2011 06:32 AM PDT
Following the retail sales and consumer spending reports of the past few weeks would leave many to believe that most nations are undergoing similar bearishness. This does not seem to be the case in Italy, however. Italian retail sales, published this morning at 9:00 GMT, revealed surprise growth of approximately 0.4% for the month of June. Forecasts were calling for a decline of about 0.1%, but today's reading reveals sudden strength in the consumer outlook in the southern European country. This figure has also added to the recent upswing in risk appetite connected with Germany's Ifo business report. Read more forex trading news on our forex blog. |
| Germany’s Business Climate Rated Higher than Forecasts Posted: 24 Jun 2011 06:30 AM PDT
The German Ifo (Information and Forschung) Business Climate report was published earlier this morning, surprising many investors with a modest uptick beyond expectations. Most analysts, myself included, had expected the report to show a stronger downtick than even the forecast 113.6. The actual reading of 114.5 in fact beat last month's reading of 114.2! Explaining such random optimism is difficult from the short-term view this blog tends to take. Given the large sample size of 7,000 survey respondents, the Ifo report could have caught some of the optimism from earlier in the month and only recently hit the snag of the Greece bailout concern. It could also be that recent reports on confidence are expected to rise following the impending dismal second quarter. Either way, the report has helped many investors turn to higher yielding currencies and the EUR seems to be on the rise as a result. Read more forex trading news on our forex blog. |
| Euro Trades Back and Forth after Italian Bank Warning Posted: 24 Jun 2011 04:46 AM PDT
The dollar was both up and down during the European trading session after Moody's put a number of Italian banks credit ratings on review. A failed test of the 1.4200 level and the euro continued to build on yesterday's rebound with the EUR/USD climbing as high as 1.4300 and taking out a number of stops on its way higher before falling back to 1.4200 after Moody's said it may downgrade 13 Italian banks. The warning comes on the heels of last week's warning of a potential cut to the Italian government's credit rating due to weak growth forecasts and the potential fallout from the Greek debt crisis. The 1.4200 is the current line in the sand for the EUR/USD and a weekly close below this level would be significant for pushing momentum in favor of euro bears. 1.4115 is the next support followed by 1.4070. Cable is trading at its opening day level after a failure to breach the March pivot. BOE Governor Mervyn King's comments today were not largely shrugged off by the market and cable has kept its head above water today. Traders should eye the 1.5935 level. A break here and the GBP/USD could decline to the late January low at 1.5750. The yen has erased all of yesterday's losses to the dollar but remains locked in a range between 81.40 and 80 for the past two weeks. I've expected the yen to perform better given the declines in global equities and general risk-off environment. The yen is stronger in the crosses but versus the USD/JPY has been stagnant. The data piece to close out the week is the core durable goods orders for the month of May. While consensus expectations are for a comfortable 1.0% rise, a surprise to the downside will likely bring a bid to the US dollar as this would show a further decline in the US economy. Read more forex trading news on our forex blog. |
| Greek Risks Drag Markets Lower Posted: 24 Jun 2011 12:20 AM PDT
It was a tale of two halves yesterday with the dollar rallying and European equities plummeting in the morning after Trichet's traffic light comments. The second half of the trading day saw the declines in the euro and sterling reduced following the announcement by Reuters of the deal between Greece and the EU/IMF. Today's trading could see more of the former type environment as credit markets continue to tighten and the austerity vote must still take place in the Greek parliament before a significant rebound in higher yielding assets may be seen. Today's Economic Data Releases: EUR – German Ifo Business Climate – 08:00 GMT GBP – BOE Governor King Speaks – 09:30 GMT USD – Core Durable Goods Orders m/m – 12:30 GMT Read more forex trading news on our forex blog. |
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