FOREXYARD: Forex News Blog | |
- Canadian Inflation Higher than Market Forecasts
- Philly Manufacturing Index Soars
- Germany’s Ifo Business Climate Rated Slightly Higher
- Looking Past the EU Economic Summit
| Canadian Inflation Higher than Market Forecasts Posted: 21 Oct 2011 07:37 AM PDT
Reports out this afternoon on the Canadian consumer price index (CPI) revealed an economy which may be experiencing a modest boom in growth. The figures revealed better than forecast numbers, helping the Canadian dollar (CAD) gain in today's end-of-week trading. The core reading of Canada's CPI posted a 0.5% growth, beating expectations for a meager 0.2% expansion. The nominal figure also rose 0.2%, above what economists were forecasting to be a 0.1% growth. The numbers paint an economy better off than last quarter and holiday shopping may be playing a large part in this overall picture. |
| Philly Manufacturing Index Soars Posted: 21 Oct 2011 07:30 AM PDT
The Philly Fed Manufacturing Index for October, published yesterday afternoon, revealed a strong upturn in manufacturing output for Pennsylvania. The forecast for yesterday's report was for a negative reading of -9.0, but actual results came in at positive 8.7. The turnaround from contraction in Philadelphia manufacturing to optimistic surge suggests a widening level of optimism in consumer demand, rising inflation, and transportation costs for raw materials with crude oil prices also holding steady. The index highlights an impending speed-up over the winter months and a likely better-than-forecast fourth quarter for manufacturing and industry. |
| Germany’s Ifo Business Climate Rated Slightly Higher Posted: 21 Oct 2011 07:25 AM PDT
The German Ifo (Information and Forschung) Business Climate report was published earlier this morning, surprising many investors with a very mild uptick beyond expectations. Most analysts had expected the report to show a stronger downtick than even the forecast 106.3. The actual reading of 106.4 gave little support to Germany, but has held many traders steady. 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 third 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. |
| Looking Past the EU Economic Summit Posted: 21 Oct 2011 06:50 AM PDT
The upcoming weekend EU economic summit is the event that has captured the headlines but it may be a potential monetary policy move that is on the minds' of FX market participants. At this time it is unclear what type of agreement France and Germany will come to though investors appear to be approaching the weekend with a bit of optimism given the gains European bourses have booked today. With the German DAX up 2.80% and the French CAC up 1.80%, the hefty equity gains display a hint of optimism leading into the weekend. This weekend's EU summit had quite the buildup but France and Germany have yet to come to an agreement and the scheduling of an additional summit this Wednesday to hash out the two nations' differences regarding the legalities of the EFSF may just be delaying the theory that the two will eventually see eye to eye. Disagreements over the involvement of the ECB in any post July 21st agreement seem to be the largest gap. France is for the inclusion of the ECB while Germany counters with an insurance scheme that could cost France its AAA credit rating. Despite the uncertainty and lack of an agreement between Europe's two perennial powers investors are approaching the weekend with a glimmer of optimism. European equities are poised to finish the day with strong gains while the EUR/USD has moved above its recent consolidation pattern. At print time the USD is lower versus the majors. While European matters are getting a majority of the headlines, perhaps a WSJ article that discusses the next possible round of US monetary policy easing is having an impact on the USD? Read more forex trading news on our forex blog. |
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