FOREXYARD: Forex News Blog | |
- Anticipating American Confidence Levels
- Euro Zone Trade Balance Deep in Deficit
- Italian Trade Balance Enters Surplus
- FX Fundamental Weekly Preview – Is the ECB Preparing Europe for a Greek Default?
| Anticipating American Confidence Levels Posted: 16 Sep 2011 06:05 AM PDT
The University of Michigan (UoM) is set to release its data on consumer confidence and inflation expectations later today. The reports are anticipating a somewhat mild dip in confidence levels, though a case could be made that traders should fear for the worst from this report. What traders have seen these past few weeks is a serious shortfall in industrial and manufacturing output, as well as turns to safety by investors as a double-dip recession appears more and more imminent. The UoM reports may not affect currency values heavily is they come in near expectations, but a broad decline could send traders reeling and seeking safety in the value of the greenback. Read more forex trading news on our forex blog. |
| Euro Zone Trade Balance Deep in Deficit Posted: 16 Sep 2011 06:01 AM PDT
Contrary to the previous article on the Italian trade balance, the euro zone's trade data and Current Account both revealed a deep plummet into deficit territory. The Current Account was only forecast to undergo a 5.6B EUR decline; the actual results were harrowing. A reading of -12.9B EUR deficit being added to the euro zone's Current Account have so far put some pressure on the 17-nation currency. The trade balance data also revealed a dip of 2.5B EUR into deficit territory. So far, the EUR is balancing the disparate reports out of the broader region and Italy, but it doesn't seem to have much effect either way. Read more forex trading news on our forex blog. |
| Italian Trade Balance Enters Surplus Posted: 16 Sep 2011 05:52 AM PDT
The report out this morning on the Italian trade balance surprised several traders by publishing a surplus. September 2010 was the last time a trade surplus was experienced by the Italian economy. So far the news has only helped the EUR gain, albeit mildly, in today's trading. Trade reports such as this rarely have a hefty impact on a currency's value. The Italian trade balance report is one such example. Though it is a positive for the region in general, and Italy specifically, it doesn't really carry that much weight in forex valuations. Nevertheless, the EUR should gain some strength from this data. Read more forex trading news on our forex blog. |
| FX Fundamental Weekly Preview – Is the ECB Preparing Europe for a Greek Default? Posted: 16 Sep 2011 05:27 AM PDT
The coordinated move by the world's leading central banks has lifted the prices of risky assets with European banking stocks seeing a sharp bounce. While the new ECB liquidity provisions look to raise market sentiment in the short run one must ask what the world's central bankers expect down the road? The last time these parties worked in tandem was three years ago in the fallout of the Lehman Brothers default. With today and tomorrow's Ecofin meeting occurring just after the new policy move and an increase in chatter from European officials that entertain the possibility of a Greek default, could the ECB be preparing the European financial system for a Greek credit event? Comments coming from the Sarkozy/Merkel/Papandreou conference call initially helped to support market sentiment though the wording was noticeably less firm and opens the door for additional interpretations as often occurs when following carefully crafted political speeches and government press releases. Given Wednesday's statement, "France, Germany are convinced Greece's future is in the euro zone," it is noticeable that the wording is less concrete than previous statements that deny any possibility to exit the EMU. Given the two day Ecofin meeting that includes special guests US Treasury Secretary Timothy Geithner and the #2 at the IMF it may be fair to assume that a Greek default is on the agenda of the meeting. Additional liquidity provisions may be a way for the ECB to begin to cushion the European financial system from the pressures it might face from a potential Greek haircut or default should the Troika not approve the next tranche of aid. With the divisions between the ECB and Germany growing, the new unlimited 3-month liquidity provisions may be considered a preemptive strike. This once again brings headline risk back into play over the weekend with the EUR having the largest risk of an opening gap lower, much like we saw at the beginning of this week. Read more forex trading news on our forex blog. |
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