http://www.ashraflaidi.com/forex-news/?a=2503
June 30, 2011 09:12 ET : Markets trade within a narrow range ahead of second round of Greek voting. German data comes on the weaker side, Trichet provides hawkish comments and GBP is the relative strength loser. Market turns to Canadian GDP and US Chicago PMI.
After the calm Asian session, the FX market is consolidating yesterdays gains. Equities, commodities and high yielding currencies trade near session highs.
German Retail Sales for May dropped to -2.8% from previous unchanged reading and German jobless reading came at -8K, slightly short of expected fall of -17K. Unemployment stayed at 7% as expected.
J. C. Trichet that spoke in Brussels earlier today reiterated that strong vigilance on inflation is warranted and ECB is ready to act in timely manner on inflation. Next ECB meeting is July 7th and rate increase is likely. This notion is supported by the Euro zone CPI figure for June estimated at 2.7% y/y which is above the ECBs 2% inflation target.
UK Nationwide HPI index for June came out flat and -1.1 y/y. Traders have been selling GBP against virtually everything. The Sterling is falling even against the weak USD and reached the psychologically important 1.60 level again. GBP is at decade lows against number of currencies (AUD, NZD, CHF).
Canada releases its GDP figures at 8:30 am ET. On a monthly basis GDP is expected to drop to -0.1% from previous reading of 0.3%. Year over year print is expected to decrease to 2.7% from previous 2.8%. Slowing US economy is likely to worsen Canadian growth figures as the US is a major Canadian trading partner.
US jobless claims fell 1k to 428k vs exp 420k. Later at 9:45 am ET Chicago PMI is due. Analysts expect fourth month of back to back deterioration. Headline is expected to show a decrease to 54.0 from previous 56.6.
EURUSD & USDJPY hit their targets from Thursday's PREMIUM TRADES
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Patrik Urban
Thursday, June 30, 2011
FXstreet.cz - forex komentář Patrika Urbana 30.6.2011
Forex - video komentář Patrika Urbana 30.6.2011 společnosti FXstreet.cz
Video najdete také v našem novém YouTube kanálu zde.
Patrik Urban
Forex trader FXstreet.cz
Video najdete také v našem novém YouTube kanálu zde.
Patrik Urban
Forex trader FXstreet.cz
Wednesday, June 29, 2011
Markets Nervously Await Greek Vote
Ahead of the Greek vote, most currency pairs are only marginally changed compared to yesterday’s NY close. The exceptions are commodity dollars that rallied strongly against the USD. Euro zone economic sentiments falls and Canadian consumer inflation surges higher.
Economic data did not have any impact today as market participants wait for Greek vote. UK Mortgage Approvals for May came in line with expectations at 46K, up slightly from previous 45K. The Euro Zone Economic Sentiment falls to 105.1 in June from 105.5 in May and Swiss KOF Economic Barometer printed 2.23 down from previous 2.3.
Canadian CPI for May came out much higher at 0.7% from previous 0.3%. Core inflation increased from 0.2% to 0.5% also significantly higher then expected 0.2%. On year over year basis prices increased 3.7%. The surge in inflation should underpin the CAD in near term as rate increases start to be expected.
Greek austerity measures have been broadly expected to pass. Equities, commodities and risk currencies benefited from this sentiment. However, situation continues to be difficult and tense. How will the austerity measures be actually implemented in light of such a strong opposition? What will happen when the results of the second round of bank stress tests are published on July 13th? Reports suggest that as many as 15 European banks may fail these tests.
New York session has only one significant data release. US Pending Home Sales for May are due at 10:00 am ET and are expected to improve significantly to 1.3% from previous drop to -11.6%. Later at 10:30 am ET Crude Oil Inventories could have an impact on oil price and consequently on the Canadian dollar.
Patrik Urban
Economic data did not have any impact today as market participants wait for Greek vote. UK Mortgage Approvals for May came in line with expectations at 46K, up slightly from previous 45K. The Euro Zone Economic Sentiment falls to 105.1 in June from 105.5 in May and Swiss KOF Economic Barometer printed 2.23 down from previous 2.3.
Canadian CPI for May came out much higher at 0.7% from previous 0.3%. Core inflation increased from 0.2% to 0.5% also significantly higher then expected 0.2%. On year over year basis prices increased 3.7%. The surge in inflation should underpin the CAD in near term as rate increases start to be expected.
Greek austerity measures have been broadly expected to pass. Equities, commodities and risk currencies benefited from this sentiment. However, situation continues to be difficult and tense. How will the austerity measures be actually implemented in light of such a strong opposition? What will happen when the results of the second round of bank stress tests are published on July 13th? Reports suggest that as many as 15 European banks may fail these tests.
New York session has only one significant data release. US Pending Home Sales for May are due at 10:00 am ET and are expected to improve significantly to 1.3% from previous drop to -11.6%. Later at 10:30 am ET Crude Oil Inventories could have an impact on oil price and consequently on the Canadian dollar.
Patrik Urban
Tuesday, June 28, 2011
GBP Drops After Disappointing Data and Comments from BoE
Traders have seen choppy trading since London session started with USD little changed against its counterparts. German Consumer Climate improves and UK current account deficit comes wider than expected. US session will bring data from housing and manufacturing sectors and latest news on consumer confidence.
German GFK consumer confidence survey for July improved slightly to 5.7 from 5.6 and marks a first advance after four consecutive months of losses. German June CPI is being released from various regions throughout the day with most parts seeing consumer inflation either 0.1% or slightly higher at 0.2%. Once compiled, the headline figure is due later today.
GBPUSD dropped to 1.5911 on lower rate hike expectation and fear of further QE after UK final Q1 GDP stayed unrevised at 0.5% and year over year figure was revised down from 1.8% to 1.6%. Current Account balance came out at GBP -9.7 bln, much wider than expected GBP -5.0 bln.
Inflation report hearing in front of parliamentary committee explained worries that members of BoE share. Among the most dovish were comments that economy continues to be too weak to withdraw stimulus and expressed concerns that further asset purchases may be warranted. It seems that calls for rate increase that we have seen in the past few months were premature.
New York session starts at 9:00 am ET when S&P CS composite index is due. The price of single family homes is expected to decrease by -3.9% from previous -3.6%. Should it come as expected, it would mark six months of negative results and more importantly 11 months of gradual back to back worsening.
Consumer Confidence for Jun is due at 10:00 am ET and it is expected unchanged at 60.8. At the same time Richmond Manufacturing Index will be released and it is expected to pick up to 2 from previous -6. In light of recent deterioration of manufacturing activity it is hard to image that this index would improve.
As the Greek parliament vote is getting closer, markets are likely to remain nervous. Choppy trading within a range is likely as players will hesitate to open new positions ahead of the decision.
Patrik Urban
German GFK consumer confidence survey for July improved slightly to 5.7 from 5.6 and marks a first advance after four consecutive months of losses. German June CPI is being released from various regions throughout the day with most parts seeing consumer inflation either 0.1% or slightly higher at 0.2%. Once compiled, the headline figure is due later today.
GBPUSD dropped to 1.5911 on lower rate hike expectation and fear of further QE after UK final Q1 GDP stayed unrevised at 0.5% and year over year figure was revised down from 1.8% to 1.6%. Current Account balance came out at GBP -9.7 bln, much wider than expected GBP -5.0 bln.
Inflation report hearing in front of parliamentary committee explained worries that members of BoE share. Among the most dovish were comments that economy continues to be too weak to withdraw stimulus and expressed concerns that further asset purchases may be warranted. It seems that calls for rate increase that we have seen in the past few months were premature.
New York session starts at 9:00 am ET when S&P CS composite index is due. The price of single family homes is expected to decrease by -3.9% from previous -3.6%. Should it come as expected, it would mark six months of negative results and more importantly 11 months of gradual back to back worsening.
Consumer Confidence for Jun is due at 10:00 am ET and it is expected unchanged at 60.8. At the same time Richmond Manufacturing Index will be released and it is expected to pick up to 2 from previous -6. In light of recent deterioration of manufacturing activity it is hard to image that this index would improve.
As the Greek parliament vote is getting closer, markets are likely to remain nervous. Choppy trading within a range is likely as players will hesitate to open new positions ahead of the decision.
Patrik Urban
Monday, June 27, 2011
French Banks to Reinvest Greek Debt; US Inflation Edges up
http://www.ashraflaidi.com/forex-news/?a=2491
June 27, 2011 09:18 ET : USD has been trading lower across the board since London open. Euro supported by news from China and France. Will SNB attempt to stop the freefall in EURCHF? Fed's preferred inflation indicator rises to highest since Aug 2010.
USD continued higher throughout the Asian session but currently trades lower across the board. An improvement in sentiment is pushing equities, commodities and higher yielding currencies higher.
The improvement can be attributed to Chinese premiers remarks that China will continue to invest in European debt. This is already a second announcement in a few days as China announced by the end of last week that it would buy Hungarian debt. The improved sentiment can also be attributed to news that French banks have an agreement with French government to reinvest Greek debt into longer maturities. French and German banks have the largest exposure to Greece. German banks have already shown interest in the French model.
EURCHF continues its freefall, reaching historical lows at 1.1816. At the beginning of April, this pair traded at 1.32 which promotes the speculation whether the SNB considers such a large and rapid move disorderly and whether it will try to slow the market down by intervening in the market. There have not been many comments from SNB officials lately and SNB holds a large long position from around 1.50 after unsuccessful interventions throughout 2009 and 2010.
US May personal income +0.3%, while personal consumption expenditure was flat (worst since Sept '09). PCE core prices (Fed's preferred inflation indicator) rose 1.2% y/y (highest since August). The combination of flat spending & rising inflation is not exactly what the Fed has wished for.
Traders should also pay attention to FOMC voting member Kocherlakota who speaks at 11:00 am in Montana. Audience questions are expected and Narayana Kocherlakota mentioned a few hawkish comments recently.
Patrik Urban
June 27, 2011 09:18 ET : USD has been trading lower across the board since London open. Euro supported by news from China and France. Will SNB attempt to stop the freefall in EURCHF? Fed's preferred inflation indicator rises to highest since Aug 2010.
USD continued higher throughout the Asian session but currently trades lower across the board. An improvement in sentiment is pushing equities, commodities and higher yielding currencies higher.
The improvement can be attributed to Chinese premiers remarks that China will continue to invest in European debt. This is already a second announcement in a few days as China announced by the end of last week that it would buy Hungarian debt. The improved sentiment can also be attributed to news that French banks have an agreement with French government to reinvest Greek debt into longer maturities. French and German banks have the largest exposure to Greece. German banks have already shown interest in the French model.
EURCHF continues its freefall, reaching historical lows at 1.1816. At the beginning of April, this pair traded at 1.32 which promotes the speculation whether the SNB considers such a large and rapid move disorderly and whether it will try to slow the market down by intervening in the market. There have not been many comments from SNB officials lately and SNB holds a large long position from around 1.50 after unsuccessful interventions throughout 2009 and 2010.
US May personal income +0.3%, while personal consumption expenditure was flat (worst since Sept '09). PCE core prices (Fed's preferred inflation indicator) rose 1.2% y/y (highest since August). The combination of flat spending & rising inflation is not exactly what the Fed has wished for.
Traders should also pay attention to FOMC voting member Kocherlakota who speaks at 11:00 am in Montana. Audience questions are expected and Narayana Kocherlakota mentioned a few hawkish comments recently.
Patrik Urban
Euro Consolidates Gains; Market turns to US Durable Goods
http://www.ashraflaidi.com/forex-news/?a=2486
June 24, 2011 08:01 ET : USD is mixed since London open. It is unchanged against EUR, up against CAD and weaker against the rest of the majors. German data improves slightly. Focus turns to US May Durable Goods Orders and final release of Q1 GDP.
EUR is consolidating gains from yesterdays New York rally after the news that Greek austerity package has been agreed upon. While the agreement is an important first step, keep in mind that this agreement has to be ratified by the parliament next week. By coincidence, the ratification process should take place during the fourth national strike this year which will last for two full days. The opposition to the austerity measures is significant so the possibility of political disruptions exists and should something unexpected occur, the common currency would likely drop.
German data came out positive this morning when German Ifo Business Climate in June rose to 114.5 from previous 114.3 and Current Assessment rose to 123.3 from 121.5.
BOE Governor King focused in his speech on Greece and needed Bank Capital reforms. The governor said that UK exposure to Greece is remarkably small and that the aim should be to make the financial system more resilient by imposing new Capital rules as it is impossible to prevent financial crises. As Mr. King did not speak directly about the UK economy, the GBP selling that often occurs during his speeches did not materialize.
Todays New York session has only one significant data release. US Durable Goods Orders for May are due at 8:30 am ET and are expected to improve significantly to 1% from previous drop to -3.6%. Core orders are expected to improve to 1% from previous -1.6%. Final release of Q1 GDP is expected at 1.9% but unless we see a major revision, reaction is likely to be muted as traders will find new information on goods orders more important.
Here's Ashraf's CNBC APPEARANCE regarding the SPR release http://video.cnbc.com/ gallery/ ?video=3000029548
Patrik Urban
June 24, 2011 08:01 ET : USD is mixed since London open. It is unchanged against EUR, up against CAD and weaker against the rest of the majors. German data improves slightly. Focus turns to US May Durable Goods Orders and final release of Q1 GDP.
EUR is consolidating gains from yesterdays New York rally after the news that Greek austerity package has been agreed upon. While the agreement is an important first step, keep in mind that this agreement has to be ratified by the parliament next week. By coincidence, the ratification process should take place during the fourth national strike this year which will last for two full days. The opposition to the austerity measures is significant so the possibility of political disruptions exists and should something unexpected occur, the common currency would likely drop.
German data came out positive this morning when German Ifo Business Climate in June rose to 114.5 from previous 114.3 and Current Assessment rose to 123.3 from 121.5.
BOE Governor King focused in his speech on Greece and needed Bank Capital reforms. The governor said that UK exposure to Greece is remarkably small and that the aim should be to make the financial system more resilient by imposing new Capital rules as it is impossible to prevent financial crises. As Mr. King did not speak directly about the UK economy, the GBP selling that often occurs during his speeches did not materialize.
Todays New York session has only one significant data release. US Durable Goods Orders for May are due at 8:30 am ET and are expected to improve significantly to 1% from previous drop to -3.6%. Core orders are expected to improve to 1% from previous -1.6%. Final release of Q1 GDP is expected at 1.9% but unless we see a major revision, reaction is likely to be muted as traders will find new information on goods orders more important.
Here's Ashraf's CNBC APPEARANCE regarding the SPR release http://video.cnbc.com/ gallery/ ?video=3000029548
Patrik Urban
FXstreet.cz - forex komentář Patrika Urbana 27.6.2011
Forex - video komentář Patrika Urbana 27.6.2011 společnosti FXstreet.cz
Video najdete také v našem novém YouTube kanálu zde.
Patrik Urban
Forex trader FXstreet.cz
Video najdete také v našem novém YouTube kanálu zde.
Patrik Urban
Forex trader FXstreet.cz
Thursday, June 23, 2011
USD Stronger Across The Board; Euro zone PMI disappoints
http://www.ashraflaidi.com/forex-news/?a=2482
June 23, 2011 08:12 ET : No change in sentiment took place as London traders continue to buy the greenback. No mention of QE3 in Bernankes press conference sent equities and riskier assets lower and helped to underpin the greenback. Fundamental data from Europe disappoint. Onto US housing data.
Data from Europe mostly disappointed today when French, German and Euro zone manufacturing PMI came short of expectations. German manufacturing PMI decreased in June to 54.9 from previous 57.7. Euro zone Manufacturing PMI slowed to 52.0 from 54.6.
As manufacturing PMI slows down in most developed countries around the world, hinting the possibility of another recession, it comes as a weak consolation that German services PMI increased to 58.3 from 56.1. Euro zone services PMI also disappointed when it printed 54.2 from previous 56.0.
CBI reported sales in the UK dropped sharply from 18 to -2 which is the worst reading since June 2010. The sterling lost close to 300 points over the past two days and currently sits at the psychological level 1.60. Clear break and daily close below this level would open way to 1.54.
The common currency has been sliding against most trading partners was further hit after Finnish PM said that risk of serious financial crisis and recession was very high and Slovakian PM announced that during a phone call, Greek PM said he cannot guarantee reforms will find support in Greek parliament. The situation continues to be serious as evidenced by further increase in price of 5 year Greed CDS. This CDS trades at 2025 bps, up 138 bps just today.
New York session starts at 8:30 am ET with Unemployment Claims that are expected unchanged at 414K. At 10:00 am ET New Home Sales May are expected to decrease slightly after three months of gains. Analysts predict 311K from previous reading of 323K. As long as we do not see a serious deterioration, USD should continue to appreciate.
Patrik Urban
June 23, 2011 08:12 ET : No change in sentiment took place as London traders continue to buy the greenback. No mention of QE3 in Bernankes press conference sent equities and riskier assets lower and helped to underpin the greenback. Fundamental data from Europe disappoint. Onto US housing data.
Data from Europe mostly disappointed today when French, German and Euro zone manufacturing PMI came short of expectations. German manufacturing PMI decreased in June to 54.9 from previous 57.7. Euro zone Manufacturing PMI slowed to 52.0 from 54.6.
As manufacturing PMI slows down in most developed countries around the world, hinting the possibility of another recession, it comes as a weak consolation that German services PMI increased to 58.3 from 56.1. Euro zone services PMI also disappointed when it printed 54.2 from previous 56.0.
CBI reported sales in the UK dropped sharply from 18 to -2 which is the worst reading since June 2010. The sterling lost close to 300 points over the past two days and currently sits at the psychological level 1.60. Clear break and daily close below this level would open way to 1.54.
The common currency has been sliding against most trading partners was further hit after Finnish PM said that risk of serious financial crisis and recession was very high and Slovakian PM announced that during a phone call, Greek PM said he cannot guarantee reforms will find support in Greek parliament. The situation continues to be serious as evidenced by further increase in price of 5 year Greed CDS. This CDS trades at 2025 bps, up 138 bps just today.
New York session starts at 8:30 am ET with Unemployment Claims that are expected unchanged at 414K. At 10:00 am ET New Home Sales May are expected to decrease slightly after three months of gains. Analysts predict 311K from previous reading of 323K. As long as we do not see a serious deterioration, USD should continue to appreciate.
Patrik Urban
Wednesday, June 22, 2011
MPC Minutes Send GBP sharply lower; All Eyes on FOMC
http://www.ashraflaidi.com/forex-news/?a=2479
June 22, 2011 09:24 ET : Now you know why our London morning IMT was titled "Sterling Fears Upcoming BoE Minutes". Indeed, the minutes did show one less hawk (see below). USD holding steady. Euro zone industrial orders disappointed. Critically important FOMC statement is later on today.
GBP was under pressure since London traders got to their desks. After the MPC meeting minutes were released, the Sterling dropped sharply. Vote was 7-2 from previous 6-3 (7 members voted for holding rates steady and 2 for rate increase). The minutes revealed a discussion about the possibility of QE extension should downside risk materialize and Adam Posen voted for GBP 50 bln increase in Asset Purchase Facility to GBP 250 bln. Recent QE comments and overall dovish stance would indicate that BoE will not be raising rates in the near future.
Other news from this morning include Swiss ZEW Economic Expectation index for June that dropped to -24.3 from previous -11.5 and Euro zone April Industrial Orders that increased to 0.7% from previous -1.5% but still came short of 1.1% expected.
The New York session will be all about FOMC. The rate decision and statement are both due at 12:30 pm ET and the press conference will start at 2:15 pm ET. The fed funds rate will stay between 0 and 0.25% and the highlight of the day will be the press conference. Traders can expect a significant volatility around these times.
The Fed will acknowledge slowing of the economy and deteriorating fundamentals. The job market has worsened with unemployment ticking back up, yet consumer inflation has been increasing steadily since November 2010. However, at this point additional round of QE is not probable. The Fed is likely to keep the main interest rate unchanged for extended period and to continue to reinvest maturing securities as not to shrink its balance sheet.
If there are no hints of QE3, equity markets will be disappointed and risk aversion will increase as there will not be any expectation of an additional liquidity injections to the financial markets. Falling equities and other types of riskier assets combined with ongoing uncertainty in Euro zone should support the USD over the near term. Should QE3 be hinted, that would be a different case entirely
Patrik Urban
June 22, 2011 09:24 ET : Now you know why our London morning IMT was titled "Sterling Fears Upcoming BoE Minutes". Indeed, the minutes did show one less hawk (see below). USD holding steady. Euro zone industrial orders disappointed. Critically important FOMC statement is later on today.
GBP was under pressure since London traders got to their desks. After the MPC meeting minutes were released, the Sterling dropped sharply. Vote was 7-2 from previous 6-3 (7 members voted for holding rates steady and 2 for rate increase). The minutes revealed a discussion about the possibility of QE extension should downside risk materialize and Adam Posen voted for GBP 50 bln increase in Asset Purchase Facility to GBP 250 bln. Recent QE comments and overall dovish stance would indicate that BoE will not be raising rates in the near future.
Other news from this morning include Swiss ZEW Economic Expectation index for June that dropped to -24.3 from previous -11.5 and Euro zone April Industrial Orders that increased to 0.7% from previous -1.5% but still came short of 1.1% expected.
The New York session will be all about FOMC. The rate decision and statement are both due at 12:30 pm ET and the press conference will start at 2:15 pm ET. The fed funds rate will stay between 0 and 0.25% and the highlight of the day will be the press conference. Traders can expect a significant volatility around these times.
The Fed will acknowledge slowing of the economy and deteriorating fundamentals. The job market has worsened with unemployment ticking back up, yet consumer inflation has been increasing steadily since November 2010. However, at this point additional round of QE is not probable. The Fed is likely to keep the main interest rate unchanged for extended period and to continue to reinvest maturing securities as not to shrink its balance sheet.
If there are no hints of QE3, equity markets will be disappointed and risk aversion will increase as there will not be any expectation of an additional liquidity injections to the financial markets. Falling equities and other types of riskier assets combined with ongoing uncertainty in Euro zone should support the USD over the near term. Should QE3 be hinted, that would be a different case entirely
Patrik Urban
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