FOREXYARD: Forex News Blog | |
- ECB Releasing Less Money into European Market
- Tokyo Core CPI in Contraction
- Further Signs of Swiss Economic Stress
- Q2 US GDP and the Jackson Hole Speech
| ECB Releasing Less Money into European Market Posted: 26 Aug 2011 06:19 AM PDT
Annualized data out of the euro zone this morning revealed a mildly sluggish growth in private loans issued throughout the region. The data seems to suggest either banks' unwillingness to lend out money from tight financials, or individuals not pursuing loans out of economic pessimism. Either way, it does not bode well for the euro zone. Supporting this data was Friday's publication of the M3 money supply, also presented in an annualized format, which revealed lower than expected growth in the amount of local currency in circulation domestically. A reduction in the amount of private loans issued and slower-than-expected growth in the domestic money supply seems to point towards unwillingness by the European Central Bank (ECB) to loosen its grips on the EUR in an attempt to stabilize the market. Given the weakness felt in EUR values these past few weeks, the move does not seem unjustified. Read more forex trading news on our forex blog. |
| Posted: 26 Aug 2011 06:14 AM PDT
The Japanese Statistics Bureau released its consumer price index (CPI) readings for Tokyo this morning, revealing an unexpected contraction in consumer prices. The news was not understood as negatively as in other places since a contraction was already expected, but the deeper downturn does raise a specter of tension in the island economy. With the Bank of Japan's (BOJ) recent forex intervention, the strength of the yen has been called into question and is being challenged on several fronts. The news that prices are in decline across Japan indicates that the value of domestic goods is falling as fewer people are buying, and the Japanese economy is coming under pressure as a result. Read more forex trading news on our forex blog. |
| Further Signs of Swiss Economic Stress Posted: 26 Aug 2011 06:10 AM PDT
Friday's publication by Switzerland of its KOF Economic Barometer revealed growing concerns about the future of the Alpine nation's growth potential. The rising strength of the franc (CHF) has begun to worry many investors who see its meteoric rise as a sign of future trade gouging and GDP decline. Today's KOF report only served to underline this heightened tension. The figure was forecast to come in near a reading of 1.84, but fell from last month's adjusted 1.98 reading to 1.61 over the past month. With the other safe haven currencies, the USD and JPY, meeting resistance from market tension and bank interventions, respectively, the Swiss franc still appears to be climbing despite this growing pessimism. Read more forex trading news on our forex blog. |
| Q2 US GDP and the Jackson Hole Speech Posted: 26 Aug 2011 05:22 AM PDT
The US dollar is weaker leading up to this week's highlight; Bernanke's Jackson Hole speech. Most market commentary suggest a disappointment for those looking for a big announcement at today's speech given the preemptive strike the Fed used yesterday in the Washington Post. The insistence by the Finnish government to obtain a pledge of collateral in return for its contribution to the Greek bailout that was secured on July 21st has the potential to torpedo the fragile agreement. Despite Greek 2-year yields that are trading at an all-time high the EUR remains supported versus the USD and in the crosses. The EUR/GBP moved through resistance at 0.8830. The pair's next resistance comes in at 0.8890 where the neckline of a potential head and shoulders pattern comes into play. The bullish chart pattern suggests a move of 240 pips but a more likely target is the resistance line off of the October and July highs at 0.9115. FX traders appear poised to take advantage of a disappointment in the market should Ben Bernanke fail to announce additional quantitative easing measures. As this is being penned the EUR/USD is testing the 1.4400 level where the 200-hour moving average comes in. Support is seen at yesterday's low of 1.4330 followed by the rising trend line from July at 1.4240. Traders should keep in mind the Bernanke speech is not the only news event on today's economic calendar. US Q2 GDP is forecasted to decline to 1.1% from the advanced reading of 1.3%. A better than expected release could catch bearish traders off guard and force some short covering. EUR/USD resistance is found at 1.4480 and 1.4540. Read more forex trading news on our forex blog. |
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