FOREXYARD: Forex News Blog

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• Running with the Bulls… in China
• British Manufacturing Dip Drags on Pound Sterling
• Russian Ruble Reaches 2008 Peak vs. Currency Basket
• American Manufacturing Hit Speed Bump in June
• Australian PPI Sees Growth Near 1%
• US “Gang of Six” Budget Plan Rallies Investor Risk-Taking
• Canadian Wholesale Sales Up in June
• Australian Leading Index Declined in May
• Canada Drawing Heavy Foreign Investment
• Aussie Motor Vehicle Sales Depict Slowing Economy
• US Industrial Production Sluggish

Running with the Bulls… in China Posted: 01 Aug 2011 08:06 AM PDT Manufacturers working in conjunction with China appeared much pleased this morning after several reports on Chinese PMI signaled solid bullishness in the Asian giant's manufacturing sector. The core report on Chinese Manufacturing PMI showed an upward movement beyond the expected reading of 50.2, reaching 50.7 instead. Adding to the bullishness surrounding China's core PMI report, HSBC's concurrent report on Final Manufacturing PMI also highlighted a solid uptick from 48.9 last month to 49.3 this month. After the recent passage of a lift on the US debt ceiling, Chinese markets appear poised for sharp gains considering the close interconnection between the two economic rivals' national debt holdings. Read more forex trading news on our forex blog.

British Manufacturing Dip Drags on Pound Sterling Posted: 01 Aug 2011 08:03 AM PDT A minor downtick in Britain's manufacturing purchasing managers index (PMI) helped drag the British pound (GBP) slightly lower in today's European trading sessions. Though the UK's housing sector was seen rising last week, a dip in manufacturing appears to be tearing into recent upswings in optimism. Mixed growth in several sectors has had traders on edge these past few weeks. Such reports out of the vital manufacturing sector give cause for concern as Britain struggles with regional debt woes and its own structural deficits. Risk appetite may be switched on this week, however, considering the recent passage of a debt ceiling increase in the United States. Should sentiment shift in favor of regional currencies, the GBP may find itself gaining throughout the week. Read more forex trading news on our forex blog.

Russian Ruble Reaches 2008 Peak vs. Currency Basket Posted: 27 Jul 2011 07:24 AM PDT The value of the Russian ruble (RUS) was seen climbing in relation to a dollar/euro basket this week. An appreciation of 0.3% on the day has helped the RUS touch an index high not seen since December 2008. Debt concerns across Europe and the United States has helped spurn the value of emerging market currencies, which is lifting the ruble against its counterparts despite internal economic tensions. Soaring oil prices have also fed the rise of the RUS in recent trading. A hold above $99 a barrel this week was fueling resurgence in ruble values against a basket of primary currencies. Other commodity linked currencies, like the South African rand (ZAR) and Australian dollar (AUD), were also seen in ascent through most of this week. A report out of the Carnegie Endowment for International Peace (http://www.carnegieendowment.org/2011/07/21/russia-stable-but-critical/419w) has labeled Russia as stable, but critical, noting the investment worries expressed in a variety of reports recently that highlight a lack of investment and reliance on imports and inventory for growth. It also notes that Russian GDP growth has been halved since the financial crisis of 2007/08 and that even domestic investors are reluctant to hold the RUS for very long as part of their portfolio. Read more forex trading news on our forex blog.

American Manufacturing Hit Speed Bump in June Posted: 27 Jul 2011 07:21 AM PDT The publication of this afternoon's report on durable goods orders highlighted the halting growth that many analysts had feared. The US Census Bureau reported a 2.1% decline in durable goods orders for the month of June, with a meager 0.1% growth in core durable goods orders. The core report, which excludes transportation items, did show small growth, but the nominal reading highlights the sentiment that companies are not investing in their logistics and transportation infrastructure. The readings have so far helped fuel the rise of safe-haven investing among traders, and this sentiment appears to be holding steady through the rest of the week. Read more forex trading news on our forex blog.

Australian PPI Sees Growth Near 1% Posted: 27 Jul 2011 07:18 AM PDT The Reserve Bank of Australia (RBA) published data on its producer price index (PPI) this morning revealing solid inflationary growth. Expectations for the quarterly figure were for a mild 0.7% on both the nominal reading and its trimmed mean (i.e. core) counterpart. Actual results from the morning's data, however, underscored the growth experienced in the Pacific economies of Australia and New Zealand recently. The data produced solid 0.9% growth on the two indices, climbing above forecasts and helping the Australian dollar (AUD) hold steady in early morning trading. Read more forex trading news on our forex blog.

US “Gang of Six” Budget Plan Rallies Investor Risk-Taking Posted: 20 Jul 2011 07:13 AM PDT As the deadline to lift America's debt ceiling approaches, a group of six US senators have stepped forward with a last-ditch plan to tackle the country's budget crisis. The behavior of financial and capital markets over the past few weeks have been roiled by massive shifts into safe-haven assets as investors fled risk. Recent market behavior, however, indicates a shift back to normalcy. The bipartisan "Gang of Six" plan is to reduce the budget deficit by $4 trillion over the next ten years, including a tax increase that would raise $1 trillion in new revenues over the same period by closing several loopholes in the American tax system. The passage of such a deal depends largely on whether the GOP will accept the tax hikes included. It has long been assumed that Congress would not allow the US government to default on its loan payments, but as the deadline inched near both parties became piqued at the other's unwillingness to compromise. The resultant deadlock has riddled global markets with added uncertainty. This week, however, what we see is the price of oil moving higher while gold and silver enter a price decline; the US dollar is paring gains as investors opt for the euro; and Asian, American and European stocks are edging higher. These are all signs that investors are expanding their economic outlook and adjusting their portfolios to take on more risk following the economic data surrounding the US housing market, high earnings reports from several large companies, as well as optimism that the "Gang of Six" proposal stands the best chance yet of being accepted and passed. This in no way guarantees that the "Gang of Six" proposal will pass, only that investors view it as a solid starting point for resolving the budget crisis. A recent Republican plan to amend the US Constitution in a way that would have required the government to have a balanced budget failed to pass by the needed majority, and it will be interesting to see how the backlash from that failed initiative plays into the negotiations over this latest proposal.

Canadian Wholesale Sales Up in June Posted: 20 Jul 2011 07:10 AM PDT A report from Statistics Canada this morning highlighted a growth in wholesale sales across the northern giant. The Canadian dollar (CAD) has been experiencing wide swings in value from shifts in risk aversion and spasmodic commodity price action these past few trading days. News of high growth in Canada's housing market has helped lift the value of the Loonie in recent trading, and this bullish sales figure should lend more weight to a region bereft of market optimism. Expectations were for mild growth of 0.2%, but today's 1.9% reading has, and should, push the CAD a smidge higher in today's afternoon session, particularly is US housing data can remain as bullish as it has been this week. Read more forex trading news on our forex blog.

Australian Leading Index Declined in May Posted: 20 Jul 2011 07:08 AM PDT The Melbourne Institute's (MI) measurement of Australia's Leading Index, a composite index of nine economic indicators, revealed a contraction of approximately 0.1% occurred in the month of May. The indicator tends to have little impact on currency values given the delay of the data release – the report is published about 50 days after the month ends. Nevertheless, news that a composite collection of major indicators have declined does not bode well for a global market rife with economic pessimism that appears to be growing by the day. So far traders have seen the Australian dollar (AUD) sell off a bit in today's trading on the news of this contraction. Read more forex trading news on our forex blog.

Canada Drawing Heavy Foreign Investment Posted: 18 Jul 2011 09:04 AM PDT A report out of Canada early this afternoon pointed towards a significant rise in foreign investment within the Canadian economy this past month. The CAD may be seeing downward price action from regional woes and risk aversion, but data such as this highlights the relative stability of the northern giant's economic values. Statistics Canada published its Foreign Securities Purchases report which was expected to show a rise of approximately C$7.41B growth. The indicator measures the total value of domestic bonds, stocks, and money-market assets purchased by foreigners during the reported month. The actual figure came in at C$15.40B, trouncing forecasts and underlining the growth in capital markets across Canada which economists have discussed only mildly in the past few weeks. Read more forex trading news on our forex blog.

Aussie Motor Vehicle Sales Depict Slowing Economy Posted: 18 Jul 2011 09:03 AM PDT The Australian Bureau of Statistics (ABS) released its monthly report on motor vehicle sales this morning to reveal two conflicting data movements with an ominous under-tone. Though overall vehicle sales were up 1.3%, overturning the previous two months' negative movement, one category of vehicle sales portrayed an economy entering a slump. Passenger and sport utility vehicles (SUVs) rose collectively about 2.5%, seasonally adjusted, in June. But the "other" category of vehicles, which accounts for business vehicles like trucks, buses, vans, pickups, and delivery fleets, sunk by approximately 7%. Consumers may feel better about purchasing a car, but businesses aren't seen to be investing in their delivery infrastructure in similar fashion. These very minute signs point to an economy that may be slowing faster than many assume.

US Industrial Production Sluggish Posted: 15 Jul 2011 08:46 AM PDT This afternoon's publication of US industrial production came out below forecasts, growing a dismal 0.2% in June. As reports reveal persistently nagging declines in growth, US confidence levels are expected to decline. The reports from the University of Michigan (UoM) are expected later this afternoon and could underline this relative decline. Forecasts have the UoM Prelim Consumer Sentiment report growing by a small amount, but given recent slowdowns in industry and manufacturing, as well as the looming fear of a debt default, may have dragged this indicator lower. The result will likely be a turn to safe-havens; helping to lift the value of the US dollar (USD) prior to the week's close.

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