http://www.ashraflaidi.com/forex-news/?a=2751
September 29, 2011 07:16 ET :
German Bundestag approves EFSF; UK mortgage approvals rise; Eurozone confidence indicators all declined. Market turns to Jobless claims, pending home sales and Canadian RMPI and IPPI.
German Bundestag approved enhanced EFSF with 523 to 85 majority. The approval was largely expected despite strong opposition not only among Germans but also among Merkel's governing coalition. Surprisingly EURUSD fell upon the announcement from 3670s to 3630s.
In the UK, August Mortgage approvals increased due to record low mortgage rates to 52.4K from 49.6K in July which is the highest since 12/2009 and above expectations of 49.5K. Net Consumer credit has also risen to GBP 0.5 bln from previous GBP 0.3 bln.
Chatter about QE does not seem to end in the UK. MPC member Spence Dale said today that "MPC has tools to act if deterioration continues" and that he is "sure that QE would work again".
The situation in the Eurozone continues to worsen as various types of confidence indicators all declined in September. The Economic confidence declined to 95 from 98.4, Consumer confidence fell to -19.1 from -18.9, Industrial confidence declined to -5.9 from -2.7 and Services confidence dropped to 0 from +3.7. To make things worse, businesses across all sectors reported a plunge in new orders. Export orders fell as well, despite the weaker Euro.
In other news, Italy and Spain extended short selling ban on bank shares stating that the ban will be effective until conditions improve and the chairman of the Chinese sovereign wealth fund said that "China cannot be expected to buy high risk Eurozone debt without clear picture of debt workout".
The US session will start at 8:30 am ET with Jobless claims that are seen at 420K from last week's 423K. Final Q2 GDP is expected at 1.2% from an initial estimate of 1.0%
8:30 am ET also brings Canadian Raw Materials Price index that is seen lower at -1.9% in August from -1.2% in July and Industrial Product Price index that is expected to decline -0.4% from previous -0.3%.
Pending home sales are due at 10:00 am ET and are anticipated lower at -1.7% in August from previous -1.3%.
Patrik Urban
Thursday, September 29, 2011
Wednesday, September 28, 2011
Finns' EFSF Approval Adds to Euro Bounce
http://www.ashraflaidi.com/forex-news/?a=2747
September 28, 2011 07:40 ET :
Euro extends bounces along with equities as Finns approve EFSF expansion, Greece backed tax hikes, German CPI could surprise to the upside; German import prices fell; Italian business confidence declined; French GDP unrevised. Market turns to US durable goods orders.
The greenback is weaker as overall sentiment remained stable. Risk currencies and equities are benefiting from the expectation that Germany will pass tomorrow the legislation needed to expand the Eurozone bailout fund. EURUSD breached yesterday's highs and trades around 1.3670 hitting all targets mentioned in the premium piece.
German CPI is still being collected and analysts expect a decline to -0.1% in September from an unchanged reading in August. Annual figure is seen unchanged at 2.4%. However, the numbers from regions that have already completed collecting data suggest that we could see an upside surprise. Region of Saxony reported +0.3% monthly increase, which is the highest print since October 2008. North Rhine Westphalia and Hessen have also reported 0.3% monthly increase.
Ashraf's Premium Intermarket Insights hit all or most targets for EURUSD, EURJPY, US Crude, while gold, EURGBP and CADJPY remain in progress. Silver, USDCAD and ES were stopped out. Direct access here: http://ashraflaidi.com/ products/ sub01/ access/ ?a=505
In other news, German August Import prices came at -0.7% m/m which is the largest fall since September 2009. Italian September business confidence fell to 94.5 from 98.6 in August printing the lowest number since 1/2010 and French final Q2 GDP was confirmed at 0.0% sparking fears of a recession. Weak print is attributed to contraction of household spending which accounts for a significant part of French GDP. Annual print declined to 1.7% from 2.2%.
GBP could come under renewed pressure in the days ahead as calls for more QE are becoming stronger. MPC member David Miles said that he was closer to voting for new QE because a "second dose of QE would boost the economy".
The EU/ECB/IMG troika has decided to return to Greece on Thursday and will hold meeting in October to determine disbursement of the next part of the aid.
The New York session will bring Durable goods orders at 8:30 am ET that are expected to contract by 0.5% in August after growing 4.1% in July. Core orders are seen at 0.1% from previous 0.8%. Crude oil inventories due at 10:30 am ET are anticipated at +1.1M barrels after dropping by 7.3M barrels last week.
Traders should note that Fed chairman Ben Bernanke speaks at 5 pm ET in Cleveland so volatility could increase during this illiquid time of the day.
Patrik Urban
September 28, 2011 07:40 ET :
Euro extends bounces along with equities as Finns approve EFSF expansion, Greece backed tax hikes, German CPI could surprise to the upside; German import prices fell; Italian business confidence declined; French GDP unrevised. Market turns to US durable goods orders.
The greenback is weaker as overall sentiment remained stable. Risk currencies and equities are benefiting from the expectation that Germany will pass tomorrow the legislation needed to expand the Eurozone bailout fund. EURUSD breached yesterday's highs and trades around 1.3670 hitting all targets mentioned in the premium piece.
German CPI is still being collected and analysts expect a decline to -0.1% in September from an unchanged reading in August. Annual figure is seen unchanged at 2.4%. However, the numbers from regions that have already completed collecting data suggest that we could see an upside surprise. Region of Saxony reported +0.3% monthly increase, which is the highest print since October 2008. North Rhine Westphalia and Hessen have also reported 0.3% monthly increase.
Ashraf's Premium Intermarket Insights hit all or most targets for EURUSD, EURJPY, US Crude, while gold, EURGBP and CADJPY remain in progress. Silver, USDCAD and ES were stopped out. Direct access here: http://ashraflaidi.com/ products/ sub01/ access/ ?a=505
In other news, German August Import prices came at -0.7% m/m which is the largest fall since September 2009. Italian September business confidence fell to 94.5 from 98.6 in August printing the lowest number since 1/2010 and French final Q2 GDP was confirmed at 0.0% sparking fears of a recession. Weak print is attributed to contraction of household spending which accounts for a significant part of French GDP. Annual print declined to 1.7% from 2.2%.
GBP could come under renewed pressure in the days ahead as calls for more QE are becoming stronger. MPC member David Miles said that he was closer to voting for new QE because a "second dose of QE would boost the economy".
The EU/ECB/IMG troika has decided to return to Greece on Thursday and will hold meeting in October to determine disbursement of the next part of the aid.
The New York session will bring Durable goods orders at 8:30 am ET that are expected to contract by 0.5% in August after growing 4.1% in July. Core orders are seen at 0.1% from previous 0.8%. Crude oil inventories due at 10:30 am ET are anticipated at +1.1M barrels after dropping by 7.3M barrels last week.
Traders should note that Fed chairman Ben Bernanke speaks at 5 pm ET in Cleveland so volatility could increase during this illiquid time of the day.
Patrik Urban
Tuesday, September 27, 2011
Euro Holds on EFSF Talk, UK CBI Sales Disappoint
Euro Holds on EFSF Talk, UK CBI Sales Disappoint
September 27, 2011 07:37 ET :
German GfK consumer confidence unchanged, Swiss consumption declined sharply; UK CBI sales fell further. Markets turn to US Home price index and Consumer confidence data, Dallas Feds Fisher on why he voted against the Twist. Details on Ashrafs Premium trades below.
CHF was unaffected when Swiss UBS Consumption Indicator declined sharply to 0.79 from 1.28 in August confirming fears mentioned in last week SNB's quarterly bulletin that the Swiss economy could experience a significant slowdown in the months ahead.
Monday's Premium; Both $EURUSD, Gold & EURJPY hit all targets, CADJPY partly done, EURGBP working, 1 $ES hi targets other stopped out. FOR DIRECT ACCESS please click here: http://ashraflaidi.com/ products/ sub01/ access/ ?a=504 TRIALISTS can click here here: http://ashraflaidi.com/ products/ sub01/
EUR is holding steady above the 1.35 level suggesting the possibility of short term strength. German GfK Consumer confidence underpinned the currency as October's survey came unchanged at 5.2 defying fears of a recession and market turbulence. However, the Economic Expectation sub-index fell sharply to 4.8 from 13.4.
UK CBI sales in September fell to -15 from -14 which is the lowest print since May 2010 and the latest confirmation of slowing economy. Retailers expect sales to decline further next month as 3M moving average of sales declined by 11%. GBPUSD may come under renewed pressure as the case for additional QE grows.
Yesterdays equity rally was founded on hopes that EU leaders may be finally ready to take the required steps necessary to deal with the crisis in Europe. One hope is that leaders are considering an increase or leveraging up of the bailout fund (EFSF). This step has raised the political temperature in Germany with fears that unless assurances are given the vote in the Bundestag on the extension of powers of the EFSF, could well get voted down. The head of the German constitutional court has already gone on record as saying politicians do not have the legal authority to make any agreements that violate or impinge on German national or fiscal sovereignty.
Any vote to increase the EFSF by the back door would do that and any such measures that impinge on German sovereignty must be put to a referendum of the people.
Greek PM Papandreou is due to meet Angela Merkel in Berlin today at the same time as the Greece parliament votes on the new austerity measures including the property tax.
The New York session will bring S&P/Case-Shiller Home Price index index at 9:00 am ET that is expected to continue its contraction by -4.4% in July from -4.5% in June
US Consumer confidence is due at 10:00 am ET and is seen higher at 46.2 in September from 44.5 in August. Market volatility could also increase at 1:20 pm ET when Dallas Fed president Richard Fisher delivers a speech titled "Why I voted against Operation Twist".
K Morrison & Patrik Urban
September 27, 2011 07:37 ET :
German GfK consumer confidence unchanged, Swiss consumption declined sharply; UK CBI sales fell further. Markets turn to US Home price index and Consumer confidence data, Dallas Feds Fisher on why he voted against the Twist. Details on Ashrafs Premium trades below.
CHF was unaffected when Swiss UBS Consumption Indicator declined sharply to 0.79 from 1.28 in August confirming fears mentioned in last week SNB's quarterly bulletin that the Swiss economy could experience a significant slowdown in the months ahead.
Monday's Premium; Both $EURUSD, Gold & EURJPY hit all targets, CADJPY partly done, EURGBP working, 1 $ES hi targets other stopped out. FOR DIRECT ACCESS please click here: http://ashraflaidi.com/ products/ sub01/ access/ ?a=504 TRIALISTS can click here here: http://ashraflaidi.com/ products/ sub01/
EUR is holding steady above the 1.35 level suggesting the possibility of short term strength. German GfK Consumer confidence underpinned the currency as October's survey came unchanged at 5.2 defying fears of a recession and market turbulence. However, the Economic Expectation sub-index fell sharply to 4.8 from 13.4.
UK CBI sales in September fell to -15 from -14 which is the lowest print since May 2010 and the latest confirmation of slowing economy. Retailers expect sales to decline further next month as 3M moving average of sales declined by 11%. GBPUSD may come under renewed pressure as the case for additional QE grows.
Yesterdays equity rally was founded on hopes that EU leaders may be finally ready to take the required steps necessary to deal with the crisis in Europe. One hope is that leaders are considering an increase or leveraging up of the bailout fund (EFSF). This step has raised the political temperature in Germany with fears that unless assurances are given the vote in the Bundestag on the extension of powers of the EFSF, could well get voted down. The head of the German constitutional court has already gone on record as saying politicians do not have the legal authority to make any agreements that violate or impinge on German national or fiscal sovereignty.
Any vote to increase the EFSF by the back door would do that and any such measures that impinge on German sovereignty must be put to a referendum of the people.
Greek PM Papandreou is due to meet Angela Merkel in Berlin today at the same time as the Greece parliament votes on the new austerity measures including the property tax.
The New York session will bring S&P/Case-Shiller Home Price index index at 9:00 am ET that is expected to continue its contraction by -4.4% in July from -4.5% in June
US Consumer confidence is due at 10:00 am ET and is seen higher at 46.2 in September from 44.5 in August. Market volatility could also increase at 1:20 pm ET when Dallas Fed president Richard Fisher delivers a speech titled "Why I voted against Operation Twist".
K Morrison & Patrik Urban
Monday, September 26, 2011
Euro Higher On the Back of Better German IFO
http://ashraflaidi.com/t/?h2740
September 26, 2011 07:48 ET :
Sentiment improved after German IFO came out above consensus. ECB Yves Mersch rejected expectations of ECB rate cut. Gold and silver recover after sharp losses during Asian session. Market turns to US New Home sales and Dallas Fed Manufacturing index. Arabic speakers can watch Ashraf on AlArabiya discussing gold and silver at 12:30 GMT (16:30 Dubai Time)
Overall sentiment has improved and risk currencies are rallying after September German IFO business climate came out at 107.5 compared to 106.5 expected. Other components of the IFO index also came above expectations Current assessment printed 117.9 vs 115.7 exp. and the Expectations part came out at 98 vs. 97.3. However, it is important to keep in mind that all three components worsened slightly compared to August readings confirming negative outlook. EURUSD has recovered to 1.3476 after falling to 1.3363 at the beginning of European trading. Other European news included Italian Consumer confidence that declined in September to 98.5 from 100.3.
Additional support for the common currency came from the ECB governing council member Yves Mersch who in an interview for MNI rejected speculations of 50 bp rate cut. Yves Mersch said that those were "wild expectations" that show that "people have lost their sense of direction".
Gold and silver surged higher over the past few hours. Gold gained almost 100 dollars when it recovered to 1626 after falling to 1533 while silver surged higher by almost 4 dollars when it reached 30 after falling to 26.10.
During the US session, the volatility could increase at 9:15 am ET when Federal Reserve governor and FOMC member Sarah Raskin delivers a speech on monetary policy in Washington DC.
August New Home Sales are due at 10:00 am ET and are seen lower at 296K from 298K in July. Despite the stabilization seen over the past 2-3 years, the sales of single family homes are still near decade lows.
Dallas Fed Manufacturing Activity index is due at 10:30 am ET and is expected to slow the rate of decline and print -8 in September from -11.4 in August.
Patrik Urban
September 26, 2011 07:48 ET :
Sentiment improved after German IFO came out above consensus. ECB Yves Mersch rejected expectations of ECB rate cut. Gold and silver recover after sharp losses during Asian session. Market turns to US New Home sales and Dallas Fed Manufacturing index. Arabic speakers can watch Ashraf on AlArabiya discussing gold and silver at 12:30 GMT (16:30 Dubai Time)
Overall sentiment has improved and risk currencies are rallying after September German IFO business climate came out at 107.5 compared to 106.5 expected. Other components of the IFO index also came above expectations Current assessment printed 117.9 vs 115.7 exp. and the Expectations part came out at 98 vs. 97.3. However, it is important to keep in mind that all three components worsened slightly compared to August readings confirming negative outlook. EURUSD has recovered to 1.3476 after falling to 1.3363 at the beginning of European trading. Other European news included Italian Consumer confidence that declined in September to 98.5 from 100.3.
Additional support for the common currency came from the ECB governing council member Yves Mersch who in an interview for MNI rejected speculations of 50 bp rate cut. Yves Mersch said that those were "wild expectations" that show that "people have lost their sense of direction".
Gold and silver surged higher over the past few hours. Gold gained almost 100 dollars when it recovered to 1626 after falling to 1533 while silver surged higher by almost 4 dollars when it reached 30 after falling to 26.10.
During the US session, the volatility could increase at 9:15 am ET when Federal Reserve governor and FOMC member Sarah Raskin delivers a speech on monetary policy in Washington DC.
August New Home Sales are due at 10:00 am ET and are seen lower at 296K from 298K in July. Despite the stabilization seen over the past 2-3 years, the sales of single family homes are still near decade lows.
Dallas Fed Manufacturing Activity index is due at 10:30 am ET and is expected to slow the rate of decline and print -8 in September from -11.4 in August.
Patrik Urban
Friday, September 23, 2011
Relief Did Not Last; Risk Is Off Again
http://www.ashraflaidi.com/forex-news/?a=2734
September 23, 2011 07:16 ET :
Improved sentiment was short lived. European data continues to weaken. SNB bulletin reiterated determination over EURCHF peg. UK mortgage approvals highest since May 2010. Volatility could increase later today during FOMC member Dudley speech.
Overall sentiment improved over night after G20 statement recognized the fragility of EU financial system and promised to take all necessary actions to stabilize the financial sector and ensure that banks have sufficient liquidity. Details are not available yet but it seems that G20 plans to increase the flexibility of the EFSF and leverage it up.
However, the relief did not last long as risk aversion started to dominate again over the past few hours sending the greenback higher and equity markets lower. Comments by ECB governing council member Klaas Knot that developments in Greece are not encouraging and Greek default cannot be ruled out contributed to reemerging concerns.
European data disappointed again when Italian Retail sales dropped 2.4% in July on annual basis after a -1.1% print in June. French Consumer confidence fell to 80 in September from 86 in August.
In Switzerland, the SNB bulletin reiterated that the SNB will enforce CHF cap with utmost determination and that the SNB still sees CHF high so it should continue to weaken. The SNB warned that the economic growth could come to a halt in second half of 2011.
GBP was the relative strength winner today after BBA mortgage approvals in August increased to 35.2K from 33.7K which is the highest print since May 2010. GBPUSD reached a high of 1.5472 but has since lost most of the gains.
Sobering news came out of China today. In an article published by MNI, Chinese government economist warned that property bubble in China is bigger than the US housing bubble was and that it is set to burst. Property bubbles bring systemic risk and it might be even worse then the United States added a researcher at the Chinese Academy of Social Sciences.
There are no data releases during the NY session.
Market volatility could increase at 1:30 pm ET when Federal Reserve Bank of New York president and FOMC member William Dudley delivers a speech in Washington about readiness for the next financial crisis. Q&A session is expected after the speech.
Patrik Urban
September 23, 2011 07:16 ET :
Improved sentiment was short lived. European data continues to weaken. SNB bulletin reiterated determination over EURCHF peg. UK mortgage approvals highest since May 2010. Volatility could increase later today during FOMC member Dudley speech.
Overall sentiment improved over night after G20 statement recognized the fragility of EU financial system and promised to take all necessary actions to stabilize the financial sector and ensure that banks have sufficient liquidity. Details are not available yet but it seems that G20 plans to increase the flexibility of the EFSF and leverage it up.
However, the relief did not last long as risk aversion started to dominate again over the past few hours sending the greenback higher and equity markets lower. Comments by ECB governing council member Klaas Knot that developments in Greece are not encouraging and Greek default cannot be ruled out contributed to reemerging concerns.
European data disappointed again when Italian Retail sales dropped 2.4% in July on annual basis after a -1.1% print in June. French Consumer confidence fell to 80 in September from 86 in August.
In Switzerland, the SNB bulletin reiterated that the SNB will enforce CHF cap with utmost determination and that the SNB still sees CHF high so it should continue to weaken. The SNB warned that the economic growth could come to a halt in second half of 2011.
GBP was the relative strength winner today after BBA mortgage approvals in August increased to 35.2K from 33.7K which is the highest print since May 2010. GBPUSD reached a high of 1.5472 but has since lost most of the gains.
Sobering news came out of China today. In an article published by MNI, Chinese government economist warned that property bubble in China is bigger than the US housing bubble was and that it is set to burst. Property bubbles bring systemic risk and it might be even worse then the United States added a researcher at the Chinese Academy of Social Sciences.
There are no data releases during the NY session.
Market volatility could increase at 1:30 pm ET when Federal Reserve Bank of New York president and FOMC member William Dudley delivers a speech in Washington about readiness for the next financial crisis. Q&A session is expected after the speech.
Patrik Urban
Thursday, September 22, 2011
EURUSD Near 1.34 As All PMIs Disappoint
http://www.ashraflaidi.com/forex-news/?a=2729
September 22, 2011 08:01 ET :
USD is stronger across the board with the exception of JPY in the ongoing session. Risk aversion is high and equity markets are deeply in red. EURUSD tumbled to 1.3427 on weak PMIs. Eurozone industrial orders dropped in July. Market turns to US Jobless claims, Canadian Retail sales.
European September PMIs all disappointed adding to growth concerns. Not only that they came out below expectations, they also confirmed further slowdown in both manufacturing and services sectors. Eurozone manufacturing PMI printed 48.4 from 49 showing a second sub 50 result back to back. Eurozone services PMI fell below 50 for the first time since August 2009 as it printed 49.1.
German manufacturing PMI fell to 50 from 50.9 and services PMI declined to 50.3 from 51.1. French manufacturing also showed second back to back contraction when it printed 47.3 from 49.1. French service sector still expanded but at a much slower rate as PMI printed 52.5 from previous 56.8.
Eurozone Industrial orders fell 2.1% in July from -1.2% in June which implies lower industrial production in the months ahead. Considering the disappointing PMIs and deterioration in sentiment, ECB rate cut is not far-fetched as the risk of a recession increases.
The NY session starts at 8:30 am ET with Jobless claims that are seen at 419K from previous 428K. Claims stubbornly continue to hover above the 400K mark and the trend from the past two months indicates that additional rise is likely.
Canadian Retail sales that are also due at 8:30 am ET are seen at -0.2% in July from previous 0.7%. However, Core sales are expected to increase 0.2% from -0.1%.
10:00 am ET will also bring August Leading indicators index expected lower at 0.2% from 0.9% and Eurozone Consumer confidence that is anticipated to worsen to -18 from previous -16.5.
Finance ministers and central bankers meet today at the G20 conference that will last till tomorrow. Washington also hosts annual IMF and World Bank meetings on the 23rd and 24th so expect volatility inducing comments.
Patrik Urban
September 22, 2011 08:01 ET :
USD is stronger across the board with the exception of JPY in the ongoing session. Risk aversion is high and equity markets are deeply in red. EURUSD tumbled to 1.3427 on weak PMIs. Eurozone industrial orders dropped in July. Market turns to US Jobless claims, Canadian Retail sales.
European September PMIs all disappointed adding to growth concerns. Not only that they came out below expectations, they also confirmed further slowdown in both manufacturing and services sectors. Eurozone manufacturing PMI printed 48.4 from 49 showing a second sub 50 result back to back. Eurozone services PMI fell below 50 for the first time since August 2009 as it printed 49.1.
German manufacturing PMI fell to 50 from 50.9 and services PMI declined to 50.3 from 51.1. French manufacturing also showed second back to back contraction when it printed 47.3 from 49.1. French service sector still expanded but at a much slower rate as PMI printed 52.5 from previous 56.8.
Eurozone Industrial orders fell 2.1% in July from -1.2% in June which implies lower industrial production in the months ahead. Considering the disappointing PMIs and deterioration in sentiment, ECB rate cut is not far-fetched as the risk of a recession increases.
The NY session starts at 8:30 am ET with Jobless claims that are seen at 419K from previous 428K. Claims stubbornly continue to hover above the 400K mark and the trend from the past two months indicates that additional rise is likely.
Canadian Retail sales that are also due at 8:30 am ET are seen at -0.2% in July from previous 0.7%. However, Core sales are expected to increase 0.2% from -0.1%.
10:00 am ET will also bring August Leading indicators index expected lower at 0.2% from 0.9% and Eurozone Consumer confidence that is anticipated to worsen to -18 from previous -16.5.
Finance ministers and central bankers meet today at the G20 conference that will last till tomorrow. Washington also hosts annual IMF and World Bank meetings on the 23rd and 24th so expect volatility inducing comments.
Patrik Urban
Monday, September 19, 2011
EURUSD Below 1.37; Awaiting Another Conference
http://www.ashraflaidi.com/forex-news/?a=2715
September 19, 2011 07:53 ET :
Euro extends selloff, EURUSD below 1.37, metals add on to gains, ECB's Liikanen talks of rapidly deterioration in global situation, NAHB Housing market index is next; later teleconference between EU/IMF and Greece. Dow futures -128 pts, S&P500 futures -17 pts.
The common currency continues to weaken amid mounting concerns over Greece. After gapping sharply lower on Asian open, EURUSD recovered a portion of its losses. However, the recovery was short lived and London traders pushed EURUSD below previous lows all the way to 1.3635 wiping all the gains Euro made as a consequence of last Thursday's liquidity measures.
The Greek situation continues to weigh in on the markets as EUR 8 bln was withheld by ECB/EU/IMF troika and Greece finances will last only a few more weeks. Additional austerity measures that are likely to be demanded will be difficult to pass given the opposition. Calls for new elections by the leader of the opposition were dismissed but show how divided Greek political scene is during this turbulent time.
Overall sentiment is worsening, sending most European equity markets deep in red, after ECB governing council member Erkki Liikanen said that the outlook for the world economy has rapidly deteriorated and that the Eurozone faces substantial downside risks. He also added that if Europe fails to constrain the crisis, it could undermine global growth.
There is only one data release during the NY session at 10:00 am ET. The National Association of Home Builders releases its Housing Market index that is expected to remain steady at 15. Throughout the year, readings have been within a narrow 13 and 17 range.
Greek finance ministry announced that a conference call between EU/IMF and Greece will take place at 12 pm ET which could prove to be a market mover. The CAD could also experience a degree of volatility at 2:00 pm when BOC governor Timothy Lane speaks in Toronto.
The key event this week will be undoubtedly be FOMC meeting scheduled for Tuesday and Wednesday. Should the FED announce "Operation Twist" the net effect could be USD positive. More on Operation Twist In Ashraf's premium piece here: http://ashraflaidi.com/ products/ sub01/ access/ ?a=496
Patrik Urban
September 19, 2011 07:53 ET :
Euro extends selloff, EURUSD below 1.37, metals add on to gains, ECB's Liikanen talks of rapidly deterioration in global situation, NAHB Housing market index is next; later teleconference between EU/IMF and Greece. Dow futures -128 pts, S&P500 futures -17 pts.
The common currency continues to weaken amid mounting concerns over Greece. After gapping sharply lower on Asian open, EURUSD recovered a portion of its losses. However, the recovery was short lived and London traders pushed EURUSD below previous lows all the way to 1.3635 wiping all the gains Euro made as a consequence of last Thursday's liquidity measures.
The Greek situation continues to weigh in on the markets as EUR 8 bln was withheld by ECB/EU/IMF troika and Greece finances will last only a few more weeks. Additional austerity measures that are likely to be demanded will be difficult to pass given the opposition. Calls for new elections by the leader of the opposition were dismissed but show how divided Greek political scene is during this turbulent time.
Overall sentiment is worsening, sending most European equity markets deep in red, after ECB governing council member Erkki Liikanen said that the outlook for the world economy has rapidly deteriorated and that the Eurozone faces substantial downside risks. He also added that if Europe fails to constrain the crisis, it could undermine global growth.
There is only one data release during the NY session at 10:00 am ET. The National Association of Home Builders releases its Housing Market index that is expected to remain steady at 15. Throughout the year, readings have been within a narrow 13 and 17 range.
Greek finance ministry announced that a conference call between EU/IMF and Greece will take place at 12 pm ET which could prove to be a market mover. The CAD could also experience a degree of volatility at 2:00 pm when BOC governor Timothy Lane speaks in Toronto.
The key event this week will be undoubtedly be FOMC meeting scheduled for Tuesday and Wednesday. Should the FED announce "Operation Twist" the net effect could be USD positive. More on Operation Twist In Ashraf's premium piece here: http://ashraflaidi.com/ products/ sub01/ access/ ?a=496
Patrik Urban
Friday, September 16, 2011
Risk On Sentiment Continues But Euro Is Weaker
http://www.ashraflaidi.com/forex-news/?a=2711
Risk On Sentiment Continues But Euro Is Weaker
September 16, 2011 07:58 ET :
Ezone current account deficit grows wider, trade balance unchanged. Merkel sees German growth near 3%. UK officials talk QE again. Market will continue to focus on EconFin meeting in Poland and later to Canadian foreign securities purchases, US TIC data and UoM Consumer Sentiment survey.
EcoFin meeting in Poland is in focus as markets will be waiting for reassuring message that the measures from 21st of July EU summit will pass national governments and that coordinated actions will be implemented should it be required. Market sentiment is likely to worsen again when the next set of disappointing data comes out as liquidity operations announced yesterday show just how serious the condition of the western economies really is.
On the data front, Eurozone Current account deficit has widened in July to EUR -12.9 bln from EUR -7.1 bln and Trade balance remained unchanged at EUR -2.5 bln.
EURUSD gives up a substantial chunk of yesterdays gains despite reassurance from chancellor Merkel that the German economy will grow near 3% in 2011 and that Eurozone will do what is necessary to defend the Euro. Merkel has yet again expressed her anti Eurozone bond stance when she said that there will not be any Eurobonds. EURUSD slid from yesterdays high of 3937 to 3777 and currently trades slightly above the 1.38 mark.
QE talk in the UK seems to be becoming the norm these days. UK business secretary Vince Cable said that QE is an initiative that can restore business and consumer demand and BOE Charles Bean said that more QE would be effective as recent economic indicators were disappointing. Despite these comments GBPUSD trades higher above 1.58 and EURGBP is lower below 0.8750.
The US session starts at 8:30 am ET with Canadian Foreign Securities purchases that are expected to reach CAD 2 bln in July from a CAD -3.4 bln in June.
US net long term TIC flows due at 9:00 am ET are seen significantly higher at USD 31.3 bln in July from dismal USD 3.7 bln in June.
9:55 am ET will bring University of Michigan Consumer Sentiment index that is estimated to increase to 57.3 in September from 55.7. Despite this anticipated increase, consumers confidence has deteriorated considerably over the past three months and reached levels last seen at the beginning of 2009.
Patrik Urban
Risk On Sentiment Continues But Euro Is Weaker
September 16, 2011 07:58 ET :
Ezone current account deficit grows wider, trade balance unchanged. Merkel sees German growth near 3%. UK officials talk QE again. Market will continue to focus on EconFin meeting in Poland and later to Canadian foreign securities purchases, US TIC data and UoM Consumer Sentiment survey.
EcoFin meeting in Poland is in focus as markets will be waiting for reassuring message that the measures from 21st of July EU summit will pass national governments and that coordinated actions will be implemented should it be required. Market sentiment is likely to worsen again when the next set of disappointing data comes out as liquidity operations announced yesterday show just how serious the condition of the western economies really is.
On the data front, Eurozone Current account deficit has widened in July to EUR -12.9 bln from EUR -7.1 bln and Trade balance remained unchanged at EUR -2.5 bln.
EURUSD gives up a substantial chunk of yesterdays gains despite reassurance from chancellor Merkel that the German economy will grow near 3% in 2011 and that Eurozone will do what is necessary to defend the Euro. Merkel has yet again expressed her anti Eurozone bond stance when she said that there will not be any Eurobonds. EURUSD slid from yesterdays high of 3937 to 3777 and currently trades slightly above the 1.38 mark.
QE talk in the UK seems to be becoming the norm these days. UK business secretary Vince Cable said that QE is an initiative that can restore business and consumer demand and BOE Charles Bean said that more QE would be effective as recent economic indicators were disappointing. Despite these comments GBPUSD trades higher above 1.58 and EURGBP is lower below 0.8750.
The US session starts at 8:30 am ET with Canadian Foreign Securities purchases that are expected to reach CAD 2 bln in July from a CAD -3.4 bln in June.
US net long term TIC flows due at 9:00 am ET are seen significantly higher at USD 31.3 bln in July from dismal USD 3.7 bln in June.
9:55 am ET will bring University of Michigan Consumer Sentiment index that is estimated to increase to 57.3 in September from 55.7. Despite this anticipated increase, consumers confidence has deteriorated considerably over the past three months and reached levels last seen at the beginning of 2009.
Patrik Urban
Thursday, September 15, 2011
USD Weaker Ahead of Data Flurry
http://www.ashraflaidi.com/forex-news/?a=2707
September 15, 2011 08:04 ET :
SNB kept rates unchanged and reiterated it would defend the 1.20 level against the Euro; UK retail sales disappoint; Eurozone CPI remained unchanged. Market turns to US CPI, jobless claims, indus production & Philly Fed, Trichets speech all due later today.
The SNB has kept the target for CHF libor rate unchanged between 0-0.25% and reiterated that it will defend the 1.20 level and that it is prepared to buy foreign currencies in unlimited quantities to weaken the Franc. EURCHF gained about 50 pips on the comments and currently trades around 1.2070
GBPUSD has reached above the 1.58 level despite UK Retail sales falling 0.2% in August. The yearly figure remained unchanged. The Office for National Statistics said that it was impossible to quantify the impact of the riots that hit London and other cities at the beginning of August. Ashrafs EURGBP trade mentioned in his latest premium piece is close to hitting its target as EURGBP broke above yesterdays highs at 0.8724
EURUSD has regained the 1.38 level despite an article published by Reuters that European finance ministers were warned of a renewed risk of a credit crunch by senior EU officials who also said that Eurozone faces a risk of vicious circle between debt, funding and negative growth. German chancellor Merkel has also repeated her stance against Eurobonds saying that they would be absolutely the wrong way forward.
On the data front, Eurozone annual CPI was steady at 2.5% in August and the core measure remained unchanged at 1.2%.
The NY session starts at 8:30 am ET with August CPI that is expected to tick up to 1.9% in August from 1.8% on annual basis. Core yearly CPI is seen steady at 3.6%.
Unemployment claims are anticipated to print 410K and Current account deficit is likely to widen slightly to USD -122 bln from USD -119 bln.
Last news that is due at 8:30 am is Empire state manufacturing index that analysts predict will lower the rate of decline and show -3.9 in September from -7.7 in August. Nevertheless, the print is still seen below 0 which indicates worsening conditions.
Capacity utilization rate should remain at 77.5% and Industrial production should decline to 0.1% from 0.9%. Both indicators are due at 9:15 am and show August results.
September Philly Fed index due at 10:00 am is expected at -14.7 from -30.7.
Volatility could increase at 2 pm when J. C. Trichet speaks at Eurofi Financial Forum in Poland.
Patrik Urban
September 15, 2011 08:04 ET :
SNB kept rates unchanged and reiterated it would defend the 1.20 level against the Euro; UK retail sales disappoint; Eurozone CPI remained unchanged. Market turns to US CPI, jobless claims, indus production & Philly Fed, Trichets speech all due later today.
The SNB has kept the target for CHF libor rate unchanged between 0-0.25% and reiterated that it will defend the 1.20 level and that it is prepared to buy foreign currencies in unlimited quantities to weaken the Franc. EURCHF gained about 50 pips on the comments and currently trades around 1.2070
GBPUSD has reached above the 1.58 level despite UK Retail sales falling 0.2% in August. The yearly figure remained unchanged. The Office for National Statistics said that it was impossible to quantify the impact of the riots that hit London and other cities at the beginning of August. Ashrafs EURGBP trade mentioned in his latest premium piece is close to hitting its target as EURGBP broke above yesterdays highs at 0.8724
EURUSD has regained the 1.38 level despite an article published by Reuters that European finance ministers were warned of a renewed risk of a credit crunch by senior EU officials who also said that Eurozone faces a risk of vicious circle between debt, funding and negative growth. German chancellor Merkel has also repeated her stance against Eurobonds saying that they would be absolutely the wrong way forward.
On the data front, Eurozone annual CPI was steady at 2.5% in August and the core measure remained unchanged at 1.2%.
The NY session starts at 8:30 am ET with August CPI that is expected to tick up to 1.9% in August from 1.8% on annual basis. Core yearly CPI is seen steady at 3.6%.
Unemployment claims are anticipated to print 410K and Current account deficit is likely to widen slightly to USD -122 bln from USD -119 bln.
Last news that is due at 8:30 am is Empire state manufacturing index that analysts predict will lower the rate of decline and show -3.9 in September from -7.7 in August. Nevertheless, the print is still seen below 0 which indicates worsening conditions.
Capacity utilization rate should remain at 77.5% and Industrial production should decline to 0.1% from 0.9%. Both indicators are due at 9:15 am and show August results.
September Philly Fed index due at 10:00 am is expected at -14.7 from -30.7.
Volatility could increase at 2 pm when J. C. Trichet speaks at Eurofi Financial Forum in Poland.
Patrik Urban
Wednesday, September 14, 2011
Euro Recovers On Euro Bonds Comments
http://www.ashraflaidi.com/forex-news/?a=2703
September 14, 2011 08:13 ET :
UK labor market data mixed; Eurozone industrial production higher. Market turns to US PPI, Retail sales, Canadian Capacity utilization rate and the teleconference between Merkel, Sarkozy and Papandreou.
UK showed mixed labor market data. Aug claimant count declined to 20.3K from previous 33.7K but the unemployment rate remained steady at 7.9%. The claimant count rate was unchanged at 4.9%. Q2 public sector employment experienced the largest decline on record as there are now 240K fewer people employed.
GBP has been under pressure over the last three weeks and reached a 1.5705 low today as the speculation about QE2 grows. MPC member Adam Posen has been QE proponent year long and it seems that his quest is gaining traction as the Chancellor George Osborne said that there are no barriers to launching more QE in the UK.
Eurozone Industrial output increased 1% in July after 0.8% contraction in June. On annual basis production rose to 4.2% from 2.6%. The bulk of the gains came from Germany where production surged 4.1% while Italy, Spain and Portugal all contracted. Another worrying aspect of today's print is that the last two releases were revised lower.
Euro is currently trading higher after the head of the European commission Jose Barroso called for deeper Eurozone integration that would stop negative cycle of debt crisis. Barroso also said that the European commission will soon present options for the introduction of Eurobonds.
The New York session starts at 8:30 am ET with August PPI that is expected to decline to 6.5% from 7.2% on annual basis. Core annual PPI is seen slightly higher at 2.6% from 2.5%. August Retail sales are anticipated lower at 0.2% from 0.5%.
Market volatility could also increase as Treasury secretary Geithner starts his speech at the Alpha conference in NY at 8:30 am.
Canadian Capacity Utilization rate due also at 8:30 am is seen steady at 79%.
The market will also focus on the conference call between Merkel, Sarkozy and Papandreou that is scheduled for 12:00 pm ET. Over the past few days, several rumors made the rounds about imminent Greek default so convincing financial markets that the situation is stable is an important and difficult task.
Patrik Urban
September 14, 2011 08:13 ET :
UK labor market data mixed; Eurozone industrial production higher. Market turns to US PPI, Retail sales, Canadian Capacity utilization rate and the teleconference between Merkel, Sarkozy and Papandreou.
UK showed mixed labor market data. Aug claimant count declined to 20.3K from previous 33.7K but the unemployment rate remained steady at 7.9%. The claimant count rate was unchanged at 4.9%. Q2 public sector employment experienced the largest decline on record as there are now 240K fewer people employed.
GBP has been under pressure over the last three weeks and reached a 1.5705 low today as the speculation about QE2 grows. MPC member Adam Posen has been QE proponent year long and it seems that his quest is gaining traction as the Chancellor George Osborne said that there are no barriers to launching more QE in the UK.
Eurozone Industrial output increased 1% in July after 0.8% contraction in June. On annual basis production rose to 4.2% from 2.6%. The bulk of the gains came from Germany where production surged 4.1% while Italy, Spain and Portugal all contracted. Another worrying aspect of today's print is that the last two releases were revised lower.
Euro is currently trading higher after the head of the European commission Jose Barroso called for deeper Eurozone integration that would stop negative cycle of debt crisis. Barroso also said that the European commission will soon present options for the introduction of Eurobonds.
The New York session starts at 8:30 am ET with August PPI that is expected to decline to 6.5% from 7.2% on annual basis. Core annual PPI is seen slightly higher at 2.6% from 2.5%. August Retail sales are anticipated lower at 0.2% from 0.5%.
Market volatility could also increase as Treasury secretary Geithner starts his speech at the Alpha conference in NY at 8:30 am.
Canadian Capacity Utilization rate due also at 8:30 am is seen steady at 79%.
The market will also focus on the conference call between Merkel, Sarkozy and Papandreou that is scheduled for 12:00 pm ET. Over the past few days, several rumors made the rounds about imminent Greek default so convincing financial markets that the situation is stable is an important and difficult task.
Patrik Urban
Tuesday, September 13, 2011
Euro Pressured As Italian Bond Auction Disappoints
http://www.ashraflaidi.com/forex-news/?a=2698
September 13, 2011 07:17 ET :
Italian bonds at center of attention; UK CPI at 3-month high, BoE's Posen renews call for QE2. EUR/CHF near the 1.20 level. WSJ story of BNP Paribas no longer having access to funds is unsubstantiated. US Federal Budget are due later today.
Bank of England Monetary Policy Committee member Adam Posen renewed his calls for QE2 today when he said the central bank should “attack the longer-end of the gilt yield curve with an additional round of GBP 50bln of asset purchases to be made over the next 3 mths”. Posen said the said that with the global economic outlook worsening, the bank should "arguably" make even more asset purchases.
UK Aug inflation highest since May at +4.5% y/y from July's 4.4% y/y; in line with expectations. Gains attributed to record gains in prices of clothing and footwear. UK Jul trade deficit rose to GBP8.92 bn from GBP 8.873bn in Jun
Last night saw the single currency pull back sharply from seven month lows against the US dollar and 10 year lows against the yen, after reports that Italy was in talks with China about possible investment opportunities. Later this morning Italy are also holding a 5 year debt auction of €3-4bn which given that bond yields have continued to rise since the resignation of ECB member Stark over the bond buying program will be a key indicator of investor attitude towards the worlds third largest bond issuer.
Australian business confidence for August nosedived from +2 in July to -8 in August suggesting that despite recent fairly robust economic data in recent days, business leaders don't feel that confident about the global economy against a backdrop on economic conditions in Europe and the US.
The US dollar index slipped back from six month highs yesterday, however if recent comments by Dallas Fed President and FOMC dissenter Richard Fisher are anything to go by it could well be a brief pause, saying he believe that the bar for further easing remained very high and he would be unlikely to support it at the September meeting.
The New York session starts at 8:30 am ET with the Import Price index for August that is expected to show a decline to 12.5% from 14% on annual basis. At 10:00 am ET September IBD/TIPP Economic Optimism index is due and is seen higher at 37.5 from previous 35.8 and finally Federal Budget deficit at 2:00 pm ET should narrow to USD -126.5 bln in August from USD -129.4 bln in July
********ASHRAF's WEBINAR TOMORROW************
Join Ashraf for an All-Star FX Webinar; For the First and Possibly Only Time ever, the most Respected Experts in the Retail Forex Industry are coming together to give you 5 Days Worth of Expert Education and Advice. Not only is the $25 admission price a BARGAIN , but part of the proceeds will also go to Doctors Without Borders and an Orphanage in Africa . Ashraf's session is on September 14 7 AM - 8 AM ET / 11 GMT - 12 GMT . FOR MORE DETAILS, click here: http://bkforexadvisors.infusionsoft.com/ go/ FX1234/ Alaidi
Kyle Morrison & Patrik Urban
September 13, 2011 07:17 ET :
Italian bonds at center of attention; UK CPI at 3-month high, BoE's Posen renews call for QE2. EUR/CHF near the 1.20 level. WSJ story of BNP Paribas no longer having access to funds is unsubstantiated. US Federal Budget are due later today.
Bank of England Monetary Policy Committee member Adam Posen renewed his calls for QE2 today when he said the central bank should “attack the longer-end of the gilt yield curve with an additional round of GBP 50bln of asset purchases to be made over the next 3 mths”. Posen said the said that with the global economic outlook worsening, the bank should "arguably" make even more asset purchases.
UK Aug inflation highest since May at +4.5% y/y from July's 4.4% y/y; in line with expectations. Gains attributed to record gains in prices of clothing and footwear. UK Jul trade deficit rose to GBP8.92 bn from GBP 8.873bn in Jun
Last night saw the single currency pull back sharply from seven month lows against the US dollar and 10 year lows against the yen, after reports that Italy was in talks with China about possible investment opportunities. Later this morning Italy are also holding a 5 year debt auction of €3-4bn which given that bond yields have continued to rise since the resignation of ECB member Stark over the bond buying program will be a key indicator of investor attitude towards the worlds third largest bond issuer.
Australian business confidence for August nosedived from +2 in July to -8 in August suggesting that despite recent fairly robust economic data in recent days, business leaders don't feel that confident about the global economy against a backdrop on economic conditions in Europe and the US.
The US dollar index slipped back from six month highs yesterday, however if recent comments by Dallas Fed President and FOMC dissenter Richard Fisher are anything to go by it could well be a brief pause, saying he believe that the bar for further easing remained very high and he would be unlikely to support it at the September meeting.
The New York session starts at 8:30 am ET with the Import Price index for August that is expected to show a decline to 12.5% from 14% on annual basis. At 10:00 am ET September IBD/TIPP Economic Optimism index is due and is seen higher at 37.5 from previous 35.8 and finally Federal Budget deficit at 2:00 pm ET should narrow to USD -126.5 bln in August from USD -129.4 bln in July
********ASHRAF's WEBINAR TOMORROW************
Join Ashraf for an All-Star FX Webinar; For the First and Possibly Only Time ever, the most Respected Experts in the Retail Forex Industry are coming together to give you 5 Days Worth of Expert Education and Advice. Not only is the $25 admission price a BARGAIN , but part of the proceeds will also go to Doctors Without Borders and an Orphanage in Africa . Ashraf's session is on September 14 7 AM - 8 AM ET / 11 GMT - 12 GMT . FOR MORE DETAILS, click here: http://bkforexadvisors.infusionsoft.com/ go/ FX1234/ Alaidi
Kyle Morrison & Patrik Urban
Monday, September 12, 2011
Germany Explores a Greek Default, Euro Regains 1.36
http://ashraflaidi.com/t/?h2695
September 12, 2011 08:20 ET : German government explores consequences of a Greek default and the possibility of a Greece exit from the Eurozone. EURUSD rebounds from under $1.35; Italian Industrial production fell. FOMC member fisher speaks on monetary policy. Ashraf's Premium Trades will be be posted ahead of London Lunch.
Eurozone data continue to disappoint as Italian Industrial production fell 0.7% in July after dropping 0.8% a month earlier. On annual basis production fell 1.6% from 0.1% and worse than expected growth of 0.2%.
According to German magazine Der Spiegel, the German government is exploring consequences of a Greek default as well as the possibility of a Greece exit from the Eurozone. German experts believe such a situation would be manageable. This increases the credibility of the news that started to circulate on Friday that Greece is about to default. Until now, the German government showed a strong opposition towards the possibility of a Greek bankruptcy. However, over the weekend, Greek Prime Minister Papandreou approved new measures in order to avoid default and keep the euro.
In the event of a default by Greece, attention will be particularly focussed on the big three French banks in particular, with ratings agency Moody's potentially priming themselves to pull the trigger on a ratings downgrade, as early as this week, after putting them on review in June.
G7 meeting ended with no objections to Japanese Finance minister Azumi's intentions to take bold action should he consider yen moves excessive and disorderly. This could mean a higher chance of an intervention as BOJ, or Ministry of Finance to be precise, would not be internationally criticized for a unilateral action.
Earlier in Asia, The August minutes from the Bank of Japan rate meeting last week showed that policymakers were agreed on the need to increase the set of stimulus measures to show that they were serious about the need to loosen monetary policy to weaken the yen and help boost the economy. Business sentiment amongst large manufacturers also improved from -23.3 in the quarter for April/June at 10.3 for the latest quarter though concerns remained about the effect the strong yen was having on exports.
No data at the NY session.
Dallas Fed president Richard Fisher delivers a speech at the National Association of Business Economists in Dallas at 4:00 pm ET. The volatility could increase as Q&A session is expected.
**** DETAILS ON ASHRAF's SEP 14 WEBINAR ****
Join Ashraf for an All-Star FX Webinar; For the First and Possibly Only Time ever, the most Respected Experts in the Retail Forex Industry are coming together to give you 5 Days Worth of Expert Education and Advice. Not only is the $25 admission price a BARGAIN , but part of the proceeds will also go to Doctors Without Borders and an Orphanage in Africa . Ashraf's session is on September 14 7 AM - 8 AM ET / 11 GMT - 12 GMT .
FOR MORE DETAILS, click here: http://bkforexadvisors.infusionsoft.com/ go/ FX1234/ Alaidi
Patrik Urban
September 12, 2011 08:20 ET : German government explores consequences of a Greek default and the possibility of a Greece exit from the Eurozone. EURUSD rebounds from under $1.35; Italian Industrial production fell. FOMC member fisher speaks on monetary policy. Ashraf's Premium Trades will be be posted ahead of London Lunch.
Eurozone data continue to disappoint as Italian Industrial production fell 0.7% in July after dropping 0.8% a month earlier. On annual basis production fell 1.6% from 0.1% and worse than expected growth of 0.2%.
According to German magazine Der Spiegel, the German government is exploring consequences of a Greek default as well as the possibility of a Greece exit from the Eurozone. German experts believe such a situation would be manageable. This increases the credibility of the news that started to circulate on Friday that Greece is about to default. Until now, the German government showed a strong opposition towards the possibility of a Greek bankruptcy. However, over the weekend, Greek Prime Minister Papandreou approved new measures in order to avoid default and keep the euro.
In the event of a default by Greece, attention will be particularly focussed on the big three French banks in particular, with ratings agency Moody's potentially priming themselves to pull the trigger on a ratings downgrade, as early as this week, after putting them on review in June.
G7 meeting ended with no objections to Japanese Finance minister Azumi's intentions to take bold action should he consider yen moves excessive and disorderly. This could mean a higher chance of an intervention as BOJ, or Ministry of Finance to be precise, would not be internationally criticized for a unilateral action.
Earlier in Asia, The August minutes from the Bank of Japan rate meeting last week showed that policymakers were agreed on the need to increase the set of stimulus measures to show that they were serious about the need to loosen monetary policy to weaken the yen and help boost the economy. Business sentiment amongst large manufacturers also improved from -23.3 in the quarter for April/June at 10.3 for the latest quarter though concerns remained about the effect the strong yen was having on exports.
No data at the NY session.
Dallas Fed president Richard Fisher delivers a speech at the National Association of Business Economists in Dallas at 4:00 pm ET. The volatility could increase as Q&A session is expected.
**** DETAILS ON ASHRAF's SEP 14 WEBINAR ****
Join Ashraf for an All-Star FX Webinar; For the First and Possibly Only Time ever, the most Respected Experts in the Retail Forex Industry are coming together to give you 5 Days Worth of Expert Education and Advice. Not only is the $25 admission price a BARGAIN , but part of the proceeds will also go to Doctors Without Borders and an Orphanage in Africa . Ashraf's session is on September 14 7 AM - 8 AM ET / 11 GMT - 12 GMT .
FOR MORE DETAILS, click here: http://bkforexadvisors.infusionsoft.com/ go/ FX1234/ Alaidi
Patrik Urban
Friday, September 9, 2011
Euro Below $1.38, Greek Default Chatter Re-emerges
http://www.ashraflaidi.com/forex-news/?a=2692
September 9, 2011 08:41 ET :
German CPI revised higher; UK PPI input prices fell; Canadian labor market deteriorated. Chatter of a Greek report doing the rounds. Ashraf's BNN interview on why Fed's Twist Operations shall shall fail t prop the euro.
USD is higher across the board amid high risk aversion and weak equity markets. The selloff in the Euro continues and EURUSD fell to 1.3788 even as German final CPI was revised up to 0.0% after earlier estimate of -0.1% (2.4% y/y). Even French Industrial production that unexpectedly rose and showed a robust 1.5% growth in July failed to underpin the euro.
UK PPI input prices dropped 1.9% in August after 0.5% in July experiencing the largest decline since April 2009. On annualized basis they grew 16.2% after 18.3% previously. GBPUSD dropped to below 1.59 but has since recovered a part of the loss.
Japanese Finance minister Azumi said during today's G7 meeting in France that he continues to monitor exchange rates and will take bold action if there are excessive moves. Interventions will undoubtedly be discussed during the G7 meeting as Canadian Finance minister Jim Flaherty said that he was concerned about unilateral actions of Japan and Switzerland that intervened in the currency market to weaken their respective currencies. Should Japan reach a consensus, Japanese Monday morning might be the ideal time for such an intervention to occur. Japan spent almost USD 60 bln during August failed intervention.
Canadian employment fell by 5.5K in August after a July rise of 7.1K, with the
unemployment rate up 0.1% to 7.3%. Ashraf's Premium trade to short CADJPY remains in progress. http://www.ashraflaidi.com/ products/ sub01/ access/ ?a=490
August Canadian Housing starts fell to 184.7K in August from 205K vs exp 200K.
Ashraf's 7-minute interview on the set of BNN, discussing intermarket dynamics, euro outlook, gold, silver, oil & Fed policy http://watch.bnn.ca/ #clip528927
Patrik Urban
September 9, 2011 08:41 ET :
German CPI revised higher; UK PPI input prices fell; Canadian labor market deteriorated. Chatter of a Greek report doing the rounds. Ashraf's BNN interview on why Fed's Twist Operations shall shall fail t prop the euro.
USD is higher across the board amid high risk aversion and weak equity markets. The selloff in the Euro continues and EURUSD fell to 1.3788 even as German final CPI was revised up to 0.0% after earlier estimate of -0.1% (2.4% y/y). Even French Industrial production that unexpectedly rose and showed a robust 1.5% growth in July failed to underpin the euro.
UK PPI input prices dropped 1.9% in August after 0.5% in July experiencing the largest decline since April 2009. On annualized basis they grew 16.2% after 18.3% previously. GBPUSD dropped to below 1.59 but has since recovered a part of the loss.
Japanese Finance minister Azumi said during today's G7 meeting in France that he continues to monitor exchange rates and will take bold action if there are excessive moves. Interventions will undoubtedly be discussed during the G7 meeting as Canadian Finance minister Jim Flaherty said that he was concerned about unilateral actions of Japan and Switzerland that intervened in the currency market to weaken their respective currencies. Should Japan reach a consensus, Japanese Monday morning might be the ideal time for such an intervention to occur. Japan spent almost USD 60 bln during August failed intervention.
Canadian employment fell by 5.5K in August after a July rise of 7.1K, with the
unemployment rate up 0.1% to 7.3%. Ashraf's Premium trade to short CADJPY remains in progress. http://www.ashraflaidi.com/ products/ sub01/ access/ ?a=490
August Canadian Housing starts fell to 184.7K in August from 205K vs exp 200K.
Ashraf's 7-minute interview on the set of BNN, discussing intermarket dynamics, euro outlook, gold, silver, oil & Fed policy http://watch.bnn.ca/ #clip528927
Patrik Urban
All Eyes On ECB and Trichet's Press Conference
http://www.ashraflaidi.com/forex-news/?a=2688
September 8, 2011 08:16 ET :
BoE, ECB both unchanged, with no new QE from BoE. Market turns to ECB and Trichet's press conference at 8:30 EST. US Trade Balance and Canadian data also due.
The Bank of England held rates steady at 0.5% and kept Asset Purchase Facility unchanged at GBP 200 bln. Sterling spikes on the announcement across the board and sends EURGBP premium trade deeper into money.
In other news, Swiss unemployment rate remained unchanged at 3% in August and June German Trade surplus narrowed slightly from EUR 11.5 bln to EUR 10.1 bln.
EUR is under pressure after the EU commission said that there is no possibility that Greece would receive further funds unless it fulfills its commitments.
The New York session will start at 8:30 am ET with ECB press conference. In light of rapidly slowing growth, high unemployment and declining inflation it is possible that J. C. Trichet could hint a rate cut which would punish the Euro.
US Trade balance also due at 8:30 EST is seen narrowing to USD -50.6 bln in July from -53.1 bln month earlier. Unemployment claims are still seen above the important 400K mark.
8:30 am EST will also bring Canadian Building permits and Trade balance. Building permits are expected to grow 0.2% in July from 2.1% and trade balance is seen at CAD -0.8 bln from previous CAD -1.6 bln. Canadian trade deficit has been widening steadily over the past four months.
Volatility could also increase at 1:30 pm ET when Fed chairman Bernanke speaks at the Economic Club of Minnesota Luncheon where he delivers a speech about the US economic outlook. Considering that the next FOMC meeting is less than two weeks away, Bernanke will be cautious and is unlikely to provide any surprising details regarding the possibility of a further easing.
Patrik Urban
September 8, 2011 08:16 ET :
BoE, ECB both unchanged, with no new QE from BoE. Market turns to ECB and Trichet's press conference at 8:30 EST. US Trade Balance and Canadian data also due.
The Bank of England held rates steady at 0.5% and kept Asset Purchase Facility unchanged at GBP 200 bln. Sterling spikes on the announcement across the board and sends EURGBP premium trade deeper into money.
In other news, Swiss unemployment rate remained unchanged at 3% in August and June German Trade surplus narrowed slightly from EUR 11.5 bln to EUR 10.1 bln.
EUR is under pressure after the EU commission said that there is no possibility that Greece would receive further funds unless it fulfills its commitments.
The New York session will start at 8:30 am ET with ECB press conference. In light of rapidly slowing growth, high unemployment and declining inflation it is possible that J. C. Trichet could hint a rate cut which would punish the Euro.
US Trade balance also due at 8:30 EST is seen narrowing to USD -50.6 bln in July from -53.1 bln month earlier. Unemployment claims are still seen above the important 400K mark.
8:30 am EST will also bring Canadian Building permits and Trade balance. Building permits are expected to grow 0.2% in July from 2.1% and trade balance is seen at CAD -0.8 bln from previous CAD -1.6 bln. Canadian trade deficit has been widening steadily over the past four months.
Volatility could also increase at 1:30 pm ET when Fed chairman Bernanke speaks at the Economic Club of Minnesota Luncheon where he delivers a speech about the US economic outlook. Considering that the next FOMC meeting is less than two weeks away, Bernanke will be cautious and is unlikely to provide any surprising details regarding the possibility of a further easing.
Patrik Urban
Wednesday, September 7, 2011
German Bailout Participation Confirmed Legal, BoC Next
http://ashraflaidi.com/t/?h2684
September 7, 2011 08:04 ET : German Constitutional Court rules that Ezone bailout is legal, UK manufacturing and industrial data were mixed. German Industrial production pushed higher. Market turns to BoC rate decision, Canadian Ivey PMI and Fed'ss Beige Book. Also details on Ashraf's appearance in this week's TORONTO MONEY SHOW below.
Euro bounced almost a full cent after German Constitutional Court ruled that German involvement in Eurozone bailouts is legal and rejected all lawsuits that were aimed at blocking country's participation in the financial assistance. However, the court said that the Parliament must have a say in decisions, which burdened Germany's budget. The bounce proved to be short lived as EURUSD retraced all gains and currently trades below the pre-release level.
German Industrial production rose by 4.0% in July after it declined by 1.0% in June which to some extent confirms Angela Merkel's earlier comments that Germany will continue to be Europe's growth locomotive and that so far "there are no signs of a recession in Germany".
In the UK, Halifax House Price Index fell 1.2% in August after a 0.2% rise in July. Manufacturing production rose 0.1% in July after dropping 0.4% in June (+1.9% from 2.1% y/y) and Industrial production declined 0.2% after unchanged print a month earlier (-0.7% from -0.3% y/y). The weak print is blamed on oil and gas rigs maintenance.
Recently, the data from the UK mostly disappointed which reinforces the removal of hawkish votes within the Bank of England's MPC
The New York session will bring Bank of Canada Overnight Rate decision and statement; due at 9:00 am ET. Analysts expect rates to remain unchanged at 1.0%. The accompanying statement is likely to point out concerns about the state of the global economy and declining growth.
At 10:00 am ET Canadian volatile Ivey PMI is due and it is seen slightly higher in August at 46.7 from July's 45.4. Despite the anticipated improvement, this would be a second reading in a row below the 50 level which indicates continued sector contraction.
At 2:00 pm ET the Fed releases its Beige Book that provides insights into the economic condition of each of the 12 Federal Reserve districts.
JOIN ASHRAF AT THIS WEEK's TORONTO MONEY
Join Ashraf in Toronto in Next Week. AshrafLaidi.com will exhibit be at next week's Toronto Money Show on Sep 8-10 - booth # 413. Ashraf will give workshops and on-booth presentations about his latest take on the markets. Click here to register (Admission is free) http://www.moneyshow.com/ tradeshow/ toronto/ world_moneyshow/ Company_Profile.asp?exh=17577
Patrik Urban
September 7, 2011 08:04 ET : German Constitutional Court rules that Ezone bailout is legal, UK manufacturing and industrial data were mixed. German Industrial production pushed higher. Market turns to BoC rate decision, Canadian Ivey PMI and Fed'ss Beige Book. Also details on Ashraf's appearance in this week's TORONTO MONEY SHOW below.
Euro bounced almost a full cent after German Constitutional Court ruled that German involvement in Eurozone bailouts is legal and rejected all lawsuits that were aimed at blocking country's participation in the financial assistance. However, the court said that the Parliament must have a say in decisions, which burdened Germany's budget. The bounce proved to be short lived as EURUSD retraced all gains and currently trades below the pre-release level.
German Industrial production rose by 4.0% in July after it declined by 1.0% in June which to some extent confirms Angela Merkel's earlier comments that Germany will continue to be Europe's growth locomotive and that so far "there are no signs of a recession in Germany".
In the UK, Halifax House Price Index fell 1.2% in August after a 0.2% rise in July. Manufacturing production rose 0.1% in July after dropping 0.4% in June (+1.9% from 2.1% y/y) and Industrial production declined 0.2% after unchanged print a month earlier (-0.7% from -0.3% y/y). The weak print is blamed on oil and gas rigs maintenance.
Recently, the data from the UK mostly disappointed which reinforces the removal of hawkish votes within the Bank of England's MPC
The New York session will bring Bank of Canada Overnight Rate decision and statement; due at 9:00 am ET. Analysts expect rates to remain unchanged at 1.0%. The accompanying statement is likely to point out concerns about the state of the global economy and declining growth.
At 10:00 am ET Canadian volatile Ivey PMI is due and it is seen slightly higher in August at 46.7 from July's 45.4. Despite the anticipated improvement, this would be a second reading in a row below the 50 level which indicates continued sector contraction.
At 2:00 pm ET the Fed releases its Beige Book that provides insights into the economic condition of each of the 12 Federal Reserve districts.
JOIN ASHRAF AT THIS WEEK's TORONTO MONEY
Join Ashraf in Toronto in Next Week. AshrafLaidi.com will exhibit be at next week's Toronto Money Show on Sep 8-10 - booth # 413. Ashraf will give workshops and on-booth presentations about his latest take on the markets. Click here to register (Admission is free) http://www.moneyshow.com/ tradeshow/ toronto/ world_moneyshow/ Company_Profile.asp?exh=17577
Patrik Urban
Tuesday, September 6, 2011
SNB Fixes EURCHF, EURUSD Bounces off DMA, ISM Next
http://www.ashraflaidi.com/forex-news/?a=2680
September 6, 2011 07:56 ET :
SNB rocks markets by fixing EURCHF at 1.20, EURCHF +10% in 80 minutes, RBA drops after rate hold, US services ISM is next. Ashraf's Premium trades will be unveiled later at the opening US bell. EURUSD bounced off its 200 dma.
The Swiss National Bank rocks the markets by setting a minimum exchange rate at 1.20 against the Euro. EURCHF soars more than 10% in 80 minutes. SNB said it will enforce this level with utmost determination and it will buy foreign currency in unlimited quantities in order to achieve a substantial and sustained weakening of the CHF.
EURCHF reached a low today at 1.1019 and jumped almost 10% after the announcement to 1.2160. USDCHF gained from 0.7840 to 0.8572. The resulting rally in euro extended into EURUSD as the pair bounced off its 200 DMA of 1.40.
One factor possibly forcing the SNB decision is today's Swiss August CPI showing -0.3% after -0.8% in July may have contributed to SNB's decision. Italy's budget announcement may also have pushed the SNB into acting ahead of another disappointing program.
The SNB said that strong Franc posed an acute risk to the economy and carries a risk of deflation. Should deflationary pressures continue, the SNB is ready to take other further steps to protect and support the economy.
The ECB said that the SNB had informed it about their intentions and that it made their decision under its own responsibility.
Japanese Yen that is sensitive to any chatter about the possibility of an intervention has weakened as well but only about 100 points.
Gold fell in reaction to SNB announcement to 1861 (silver to 41.70) but it has since recovered about half of its losses.
In other news, Eurozone GDP was not revised and stayed at 0.2% q/q. Yearly figure was revised down to 1.6% from 1.7%. German July manufacturing orders fell by -2.8% after they grew by 1.8% a month earlier. In the US, the US 10 year treasury yield fell below 2% for the first time in 60 years when it reached 1.975%.
The New York session will bring August ISM Non-Manufacturing composite index that is seen at 51.0, down from 52.7 a month earlier.
This morning's RBA rate decision left interest rates unchanged at 4.75%, and given the uncertain outlook for growth it remains unlikely that the bank will raise rates any time in the near future. While some economists are forecasting a rate cut by the end of the year, it appears that recent weak economic data is more likely to set the tone, and suggests that for now the bank remains fairly relaxed with rates at current levels due to concern about the global growth outlook, and recent turmoil in financial markets due to the debt situation in Europe.
Yesterday's not unexpected drop in services PMI data in the UK has prompted some fears with respect to further QE by the Bank of England this Thursday. This morning's disappointing BRC retail sales numbers won't have done anything to alter that perception, no matter how misguided the perception might be. The services PMI data did drop sharply, however given the events in August and the fall-out from the riots that shouldn't have been a surprise. In the wake of events in Europe and the high levels of inflation it is unlikely that the Bank will move this Thursday, despite some economists suggesting they might
Kyle Morrison & Patrik Urban
September 6, 2011 07:56 ET :
SNB rocks markets by fixing EURCHF at 1.20, EURCHF +10% in 80 minutes, RBA drops after rate hold, US services ISM is next. Ashraf's Premium trades will be unveiled later at the opening US bell. EURUSD bounced off its 200 dma.
The Swiss National Bank rocks the markets by setting a minimum exchange rate at 1.20 against the Euro. EURCHF soars more than 10% in 80 minutes. SNB said it will enforce this level with utmost determination and it will buy foreign currency in unlimited quantities in order to achieve a substantial and sustained weakening of the CHF.
EURCHF reached a low today at 1.1019 and jumped almost 10% after the announcement to 1.2160. USDCHF gained from 0.7840 to 0.8572. The resulting rally in euro extended into EURUSD as the pair bounced off its 200 DMA of 1.40.
One factor possibly forcing the SNB decision is today's Swiss August CPI showing -0.3% after -0.8% in July may have contributed to SNB's decision. Italy's budget announcement may also have pushed the SNB into acting ahead of another disappointing program.
The SNB said that strong Franc posed an acute risk to the economy and carries a risk of deflation. Should deflationary pressures continue, the SNB is ready to take other further steps to protect and support the economy.
The ECB said that the SNB had informed it about their intentions and that it made their decision under its own responsibility.
Japanese Yen that is sensitive to any chatter about the possibility of an intervention has weakened as well but only about 100 points.
Gold fell in reaction to SNB announcement to 1861 (silver to 41.70) but it has since recovered about half of its losses.
In other news, Eurozone GDP was not revised and stayed at 0.2% q/q. Yearly figure was revised down to 1.6% from 1.7%. German July manufacturing orders fell by -2.8% after they grew by 1.8% a month earlier. In the US, the US 10 year treasury yield fell below 2% for the first time in 60 years when it reached 1.975%.
The New York session will bring August ISM Non-Manufacturing composite index that is seen at 51.0, down from 52.7 a month earlier.
This morning's RBA rate decision left interest rates unchanged at 4.75%, and given the uncertain outlook for growth it remains unlikely that the bank will raise rates any time in the near future. While some economists are forecasting a rate cut by the end of the year, it appears that recent weak economic data is more likely to set the tone, and suggests that for now the bank remains fairly relaxed with rates at current levels due to concern about the global growth outlook, and recent turmoil in financial markets due to the debt situation in Europe.
Yesterday's not unexpected drop in services PMI data in the UK has prompted some fears with respect to further QE by the Bank of England this Thursday. This morning's disappointing BRC retail sales numbers won't have done anything to alter that perception, no matter how misguided the perception might be. The services PMI data did drop sharply, however given the events in August and the fall-out from the riots that shouldn't have been a surprise. In the wake of events in Europe and the high levels of inflation it is unlikely that the Bank will move this Thursday, despite some economists suggesting they might
Kyle Morrison & Patrik Urban
Monday, September 5, 2011
Central Banks Rate Announcements Preview
http://www.ashraflaidi.com/forex-news/?a=2677
September 5, 2011 07:31 ET :
USD extends robustness across the board amid heightened risk aversion. Labor Day holidays in the US and in Canada will mean narrow trading ranges and low liquidity with the risk of erratic moves. This week will bring interest rates announcements from several major central banks. Ashraf's Premium Insights return tomorrow. All 4 trades shorting EUR have hit their limits so did the gold longs.
AUD has been declining ahead of the upcoming RBA announcement that is due on Tuesday at 12:30 am ET. All 25 economists surveyed by Bloomberg News expect that Australia Cash will stay steady at 4.75%. This notion is supported by RBA governor Stevens who earlier mentioned that while there is some turbulence in the financial markets, monetary policy will not be changed. The implied probability of an interest rate cut surged after disappointing labor market data four weeks ago, but this probability decreased and currently stands at around 18%.
The Bank of Japan will announce rates on Tuesday night as well and their Overnight Call Rate is also seen unchanged at below 0.1%. Market participants have started to price in further easing by the BOJ and many expect that the BOJ will follow the FED in their actions.
Wednesday will bring the Bank of Canada rate statement and the Overnight Rate is also likely to stay unchanged at 1%. While lower rates are not expected, many analysts now predict that next rate hike will come at the end of 2012 or beginning of 2013.
Thursday should prove to be an exciting day for FX traders as both BOE and ECB will announce their rate decisions. The BOE will publish theirs at 7am ET and the rates should stay unchanged. The opposition to further QE seems to be still strong but in light of deteriorating fundamentals, new QE is becoming somewhat more possible. Watch for the Asset Purchase Facility that currently stands at GBP 200 bln. Last week Adam Posen a Monetary Policy Committee member was quoted by Reuters that G7 countries should provide more easing in order to support growth. It will be interesting to see whether he was able to convince other MPC members.
The ECB announces its rate decision at 7:45 am ET and even the European rate is anticipated to stay at 1.5%. However, keep in mind an article published by Bloomberg last week that quoted the CEO of PIMCO Mohamed El-Erian who believes the ECB may be forced to cut rates as the risk of a recession in the Eurozone has increased to 50% in his view. Even if rates are kept steady, watch for ECB press conference at 8:30 am ET for any dovish comments.
DETAILS ON ASHRAF's TORONTO APPEARANCE Sep 8-10
http://ashraflaidi.com/ t/ ?h2676
Patrik Urban
September 5, 2011 07:31 ET :
USD extends robustness across the board amid heightened risk aversion. Labor Day holidays in the US and in Canada will mean narrow trading ranges and low liquidity with the risk of erratic moves. This week will bring interest rates announcements from several major central banks. Ashraf's Premium Insights return tomorrow. All 4 trades shorting EUR have hit their limits so did the gold longs.
AUD has been declining ahead of the upcoming RBA announcement that is due on Tuesday at 12:30 am ET. All 25 economists surveyed by Bloomberg News expect that Australia Cash will stay steady at 4.75%. This notion is supported by RBA governor Stevens who earlier mentioned that while there is some turbulence in the financial markets, monetary policy will not be changed. The implied probability of an interest rate cut surged after disappointing labor market data four weeks ago, but this probability decreased and currently stands at around 18%.
The Bank of Japan will announce rates on Tuesday night as well and their Overnight Call Rate is also seen unchanged at below 0.1%. Market participants have started to price in further easing by the BOJ and many expect that the BOJ will follow the FED in their actions.
Wednesday will bring the Bank of Canada rate statement and the Overnight Rate is also likely to stay unchanged at 1%. While lower rates are not expected, many analysts now predict that next rate hike will come at the end of 2012 or beginning of 2013.
Thursday should prove to be an exciting day for FX traders as both BOE and ECB will announce their rate decisions. The BOE will publish theirs at 7am ET and the rates should stay unchanged. The opposition to further QE seems to be still strong but in light of deteriorating fundamentals, new QE is becoming somewhat more possible. Watch for the Asset Purchase Facility that currently stands at GBP 200 bln. Last week Adam Posen a Monetary Policy Committee member was quoted by Reuters that G7 countries should provide more easing in order to support growth. It will be interesting to see whether he was able to convince other MPC members.
The ECB announces its rate decision at 7:45 am ET and even the European rate is anticipated to stay at 1.5%. However, keep in mind an article published by Bloomberg last week that quoted the CEO of PIMCO Mohamed El-Erian who believes the ECB may be forced to cut rates as the risk of a recession in the Eurozone has increased to 50% in his view. Even if rates are kept steady, watch for ECB press conference at 8:30 am ET for any dovish comments.
DETAILS ON ASHRAF's TORONTO APPEARANCE Sep 8-10
http://ashraflaidi.com/ t/ ?h2676
Patrik Urban
Friday, September 2, 2011
Metals Surge, CHF Firms up Despite Weak Data; NFP is Next
http://www.ashraflaidi.com/forex-news/?a=2673
September 2, 2011 07:57 ET :
Gold hits 1860, silver at 42.60s. Swiss employment drops significantly, UK construction PMI declined and Eurozone PPI increased. PIMCO's El-Erian sees ECB cutting rates. Market turns to US labor market data.
The employment level in Switzerland dropped significantly in the last quarter to 2.77M from 4.11M previously. Such a drop comes as a surprise especially because analysts expected an unchanged reading of 4.11M. Despite this alarmingly bad result, CHF continues to surge as EURCHF lost another 200+ points and reached as low as 1.1061.
UK construction PMI fell in August to 52.6 from 53.5 in July which is the lowest print since December 2010. Construction PMI has been decreasing steadily over the past five months.
Eurozone monthly PPI came out at 0.5% from a previous unchanged reading and reached 6.1% on annual basis in July. The highest growth came out of the energy component.
A noteworthy article was published by Bloomberg last night in which Mohamed El-Erian, the CEO of PIMCO, said that ECB will probably cut interest rates as the chance of a recession in the Eurozone has risen to 50%.
The New York session will bring the eagerly awaited labor market news. August Non Farm Payrolls are expected to drop to 74K from 117K in July and the unemployment rate is seen unchanged at 9.1%.
Wednesday's ADP report showed a somewhat lower print than anticipated (91K vs. 102K exp.) so the probability of a significant positive surprise is lower to some extent. It is important to keep in mind that the correlation between ADP and NFP is not high (slightly above 0.6) and that ADP report excludes government workers.
Average hourly earnings are seen growing at 2.2% on annual basis in August from 2.3% a month earlier.
Patrik Urban
September 2, 2011 07:57 ET :
Gold hits 1860, silver at 42.60s. Swiss employment drops significantly, UK construction PMI declined and Eurozone PPI increased. PIMCO's El-Erian sees ECB cutting rates. Market turns to US labor market data.
The employment level in Switzerland dropped significantly in the last quarter to 2.77M from 4.11M previously. Such a drop comes as a surprise especially because analysts expected an unchanged reading of 4.11M. Despite this alarmingly bad result, CHF continues to surge as EURCHF lost another 200+ points and reached as low as 1.1061.
UK construction PMI fell in August to 52.6 from 53.5 in July which is the lowest print since December 2010. Construction PMI has been decreasing steadily over the past five months.
Eurozone monthly PPI came out at 0.5% from a previous unchanged reading and reached 6.1% on annual basis in July. The highest growth came out of the energy component.
A noteworthy article was published by Bloomberg last night in which Mohamed El-Erian, the CEO of PIMCO, said that ECB will probably cut interest rates as the chance of a recession in the Eurozone has risen to 50%.
The New York session will bring the eagerly awaited labor market news. August Non Farm Payrolls are expected to drop to 74K from 117K in July and the unemployment rate is seen unchanged at 9.1%.
Wednesday's ADP report showed a somewhat lower print than anticipated (91K vs. 102K exp.) so the probability of a significant positive surprise is lower to some extent. It is important to keep in mind that the correlation between ADP and NFP is not high (slightly above 0.6) and that ADP report excludes government workers.
Average hourly earnings are seen growing at 2.2% on annual basis in August from 2.3% a month earlier.
Patrik Urban
Thursday, September 1, 2011
Will US Manufacturing Also Contract?
http://www.ashraflaidi.com/forex-news/?a=2670
September 1, 2011 07:49 ET :
Both Eurozone Manufacturing PMI and UK Manufacturing PMI contracted, US Manufacturing ISM and Unemployment claims are next. USD is stronger in the ongoing session with the exception of CHF that gained as EURCHF plunged 200+ points. UK Manufacturing PMI showed a similar result as Eurozone manufacturing PMI just 30 minutes earlier. Ashraf's Premium Trades are up
Manufacturing PMI in the UK slowed to 49 in August from 49.4 in July printing the worst result since June 2009. Despite the weak print, the figure was still stronger than the estimate of 48.5. The manufacturing sector in the UK contracted for the second time in a row.
The collateral deal between Finland and Greece showed up on the newswires again today as Irish finance minister said that the deal is definitely off the table and that both parties are seeking other solutions. German government official later said that German, Dutch and Finnish finance ministers will meet on Tuesday in Berlin to discuss this issue.
The New York session starts at 8:30 am ET with Unemployment claims that have been gradually increasing the past three weeks. This week claims are seen at 407K from previous 417K.
August ISM Manufacturing is due at 10:00 am ET and it is expected to fall further to 48.7 from previous 50.9. This is the first month in almost two years when analysts expect a reading below 50 which indicates a manufacturing sector contraction. The decline seen over the past four months (April's reading was 60.4!) confirms the significant deterioration that the economy is experiencing. Should fundamental data releases continue to disappoint, the Fed's projections that the growth will pick up in the second half of the year is likely to be questioned soon.
Traders should also note that FOMC member and Federal Reserve Governor Elizabeth Duke will speak at 12:00 pm about the housing market. Q&A session after the speech is expected so any remarks regarding monetary policy could cause high volatility.
Ashraf's Premium piece that seeks to exploit, among others, further weakness in the euro can be found here: http://ashraflaidi.com/ products/ sub01/access/?a=486 Nonsubscribers can become members here: http://ashraflaidi.com/ products/ sub01/
Patrik Urban
September 1, 2011 07:49 ET :
Both Eurozone Manufacturing PMI and UK Manufacturing PMI contracted, US Manufacturing ISM and Unemployment claims are next. USD is stronger in the ongoing session with the exception of CHF that gained as EURCHF plunged 200+ points. UK Manufacturing PMI showed a similar result as Eurozone manufacturing PMI just 30 minutes earlier. Ashraf's Premium Trades are up
Manufacturing PMI in the UK slowed to 49 in August from 49.4 in July printing the worst result since June 2009. Despite the weak print, the figure was still stronger than the estimate of 48.5. The manufacturing sector in the UK contracted for the second time in a row.
The collateral deal between Finland and Greece showed up on the newswires again today as Irish finance minister said that the deal is definitely off the table and that both parties are seeking other solutions. German government official later said that German, Dutch and Finnish finance ministers will meet on Tuesday in Berlin to discuss this issue.
The New York session starts at 8:30 am ET with Unemployment claims that have been gradually increasing the past three weeks. This week claims are seen at 407K from previous 417K.
August ISM Manufacturing is due at 10:00 am ET and it is expected to fall further to 48.7 from previous 50.9. This is the first month in almost two years when analysts expect a reading below 50 which indicates a manufacturing sector contraction. The decline seen over the past four months (April's reading was 60.4!) confirms the significant deterioration that the economy is experiencing. Should fundamental data releases continue to disappoint, the Fed's projections that the growth will pick up in the second half of the year is likely to be questioned soon.
Traders should also note that FOMC member and Federal Reserve Governor Elizabeth Duke will speak at 12:00 pm about the housing market. Q&A session after the speech is expected so any remarks regarding monetary policy could cause high volatility.
Ashraf's Premium piece that seeks to exploit, among others, further weakness in the euro can be found here: http://ashraflaidi.com/ products/ sub01/access/?a=486 Nonsubscribers can become members here: http://ashraflaidi.com/ products/ sub01/
Patrik Urban
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