*Daily Forex market overviews by MasterForex.com* - page 35
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Overview of the main economical events of the current day - 20/02/2013
EUR bounces back; GBP reaches new lows
EUR traded quite strong against USD yesterday and showed some noticeable gains even despite some negative statistics: housing construction is down as well as business sentiment measured by ZEW. However, consumer confidence is up in both Germany and Eurozone, while Greece’s budget deficit has shrank (albeit not by much) – these factors allowed EUR to show some gains vs. USD.
JPY also gained against USD as it seems like not everybody in Japanese government is a fan of quantitative easing – Minister of Finance is against the purchase of foreign securities which is part of the plan according to Prime Minister. A meeting between USA President and Japanese Prime Minister is likely to be under investors radar – if Obama supports Japanese interventions into the economy, we are likely to see another round of JPY sell-off.
GBP reached its low vs. USD since July as market participants are afraid that new monetary and tax policies will continue to put pressure on the economy. Add to the mix a possibility of UK losing its credit rating and that a new Head of Bank of England might pursue a softer policy that the current one and that easily explains the weakness of GBP.
By MasterForex Company
Overview of the main economical events of the current day - 21/02/2013
USD jumps up on FOMC meeting minutes
USD raised against most of the currencies after a publication of FOMC meeting minutes that suggest that American economy is slowly recovering along with the rest of the world and that both housing and employment situations are looking up. Moreover, the solution of “fiscal cliff” problem decreased the risks to the economy and market participants took action boldly on this positive report.
EUR was more or less supported by news from Germany – January inflation data shows some increase due to high electricity prices allowing to postpone wildly expected slowdown of inflation in the country.
GBP continues to decline – it reached a 15 month minimum vs EUR after Bank of England meeting minutes were released showing that some members voted for expanding the asset purchase program this month. GBP also decreased against USD as well due to the fact that decreasing interest rates were also discussed as part of the possible solution.
By MasterForex Company
Overview of the main economical events of the current day - 22/02/2013
EUR reaches a 6 week low against USD
EUR reached a 6 week low vs USD after weak statistics that show that business activity in the region is declining more than expected. The business activity index feel from 48.6 to 47.3, while market participants were expecting an increase up to 49. The decline is happening among all sectors and numbers are below expectations providing the market with a sell off opportunity.
EUR also continues its decline vs JPY for a third day in a row on the back of the possibility of cutting the interest rates in order to stimulate UK economy.
JPY itself is showing gains against most currencies after media reporting that ex Deputy Head of Bank of Japan Mr. Ivata and the president of Asian Bank for Development Mr. Kuroda are two main candidates for the Head of Bank of Japan position. We’ll also mention that Mr. Ivata supports the idea of purchasing foreign securities to stimulate growth.
USD showed some decline after weak manufacturing activity data, which came at negative 12.5 compared to negative 5.8 a month before and expectations of growth to 0.7 in February.
By MasterForex Company
Overview of the main economical events of the current day - 25/02/2013
EUR continues its decline
EUR reached a month low against USD after ECB announcing that financial institutions are to repay less of their 3-year loans this week than expected. This erased the gains EUR showed earlier on higher than expected IFO index from Germany – as a result, EUR plummeted on news that banks are to repay only EUR 61bn per year – a level almost twice below than expected.
EUR also declined against JPY after European commission published a report which suggests that region’s economy is contracting for a second year in a row. According to the report EU’s GDP is to decline by 0.3% in 2013 and grow by only 1.4% next year.
JPY itself lost its strength on the eve of the meeting between American President and Japanese Prime Minister. Probably the most import piece of news for the currency in short term is the upcoming announcement of the next Head of Bank of Japan which might be made during this week.
By MasterForex Company
Overview of the main economical events of the current day - 26/02/2013
EUR erases its gains after disappointing Italian elections
EUR heavily declined erasing its recent gains on the backdrop of Italian elections which ended with a split between center-left and Berlusconi. Investors took a lack of unified decision as a hint of upcoming political battles and quickly reacted to the news.
JPY continues its decline reaching May 2010 levels against USD following the rumors that Japanese Prime Minister is to select someone supporting quantitative easing as a next Head of Bank of Japan.
GBP declined to a 2 year low after Moody’s cut sovereign bond rating of UK by 1 notch. While the outlook remains stable, the agency sees risks for economy recovery due to slowdown in growth rates. As the agency expects slow recovery at least until 2016, they forecast rising government debt in the coming years which is likely to result in continuing spending cuts.
By MasterForex Company
Overview of the main economical events of the current day - 27/02/2013
EUR swings back and forth
EUR rose from 7 weeks low vs. USD after investors bet on the fact that ECB will intervene to limit losses from so-called “periphery bonds”. The yields in Italian and Spanish bond markets are slightly up, while Italian stock market plummeted down after former Prime Minister Berlusconi announced that a union between left-centric party and him is impossible.
USD was under pressure after Head of FOMC Ben Bernanke announced that US economy will continue to recover this year, however labor market and the economy in whole are still weak, meaning that a next round of easing might be required. He also said that automatic spending cuts that are expected to be implemented starting this Friday are likely to negatively affect the rates of recovery.
As a result of the turbulence in forex markets, JPY appeared as a defensive option, which allowed it to show some gains.
By MasterForex Company
Overview of the main economical events of the current day - 28/02/2013
Euro continues to rebound
EUR continues to grow vs USD thanks to positive news coming from both Italy and Germany. Italy successfully placed its bonds on the back of rising economic confidence, while German Gfk released its consumer confidence figures that show an increase in the numbers – which comes in line with confidence estimates of two other German organizations (Ifo and ZEW). Looks like we can expect to see some recovery in German economy after somewhat disappointing growth rates in 4Q.
JPY was rising against most major currencies on upcoming appointment of Head of Bank of Japan and expectations that Mr Kuroda (who is nominated by the government and is against aggressive easing) is likely to take the position.
GBP grew against USD after a member of Bank of England proposed re-setting the target inflation level.
While two major figures were speaking yesterday – namely, Head of FOMC Ben Bernanke and ECB’s Head Mario Draghi, neither of them made any surprising comments which resulted in almost no reaction from market participants.
By MasterForex Company
Overview of the main economical events of the current day - 01/03/2013
USD shows gains as other currencies decline
EUR is falling against USD marking first monthly decline since July on the back of the Italian political battles as well as decreasing inflation in EU, which potentially opens doors for increased CB interventions. Moreover, Head of ECB Mario Draghi announced that no tightening of the monetary policy is planned in the near term. Even despite somewhat weak GDP data which shows that American economy grew by only 0.1% in 4Q compared to expectations of 0.5%, USD was rallying up.
GDP traded somewhat flat as Gfk consumer confidence index came at -26 in February – same level showed a month before and widely expected.
JPY remains under pressure after Prime Minister Shinzo Abe proposed Hariko Kuroda (Head of Asian Bank for Development) as a new head of Bank of Japan. Kuroda is known to be a supporter of additional stimulus and says that Bank of Japan has wide opportunities to do so.
By MasterForex Company
Overview of the main economical events of the current day - 04/03/2013
Both EUR and GBP declined rapidly on poor statistics
EUR is falling fast vs USD after Friday reports show declining manufacturing activity on the back of a record high unemployment level. According to Eurostat, unemployment reached 11.9% in January which is the highest number ever recorded in EU history. As a result, the union currency is entering its fourth consecutive week of decline against USD.
GBP is also under serious pressure after Markit PMI for February came at only 47.9 – a level below a threshold of 50, which separates growth and decline areas. The market expected the number to come at 51.0, however the number of both new external and internal orders is falling, while companies are firing people at highest rates in the last 3 years. This resulted in market participants becoming more sure that Bank of England is likely to introduce new easing measures during the next meeting which takes place this Thursday.
By MasterForex Company
Overview of the main economical events of the current day - 05/03/2013
Italian political battles put pressure on EUR and GBP
EUR is swinging back and forth against USD on the back of Italian politicians who can not form a coalition as well as upcoming GDP data for 4Q which is likely to show a recession in 4Q12. Market participants are waiting for the Financial Ministers meeting in Brussels and a number of Central Banks discussing their policies during the week. Finance Ministers are deciding whether they should give more time for Ireland and Portugal to repay their aid loans.
JPY is rising against almost all major currencies after Chinese index CSI 300 reached a 2 year low. JPY was increasing even after next Head of Bank of Japan Haruhiko Kuroda made a promise to pursue a softer monetary policy in order to defeat the deflation in the country.
GBP rose vs both EUR and USD as investors are afraid that the new Italian government will form for too long which potentially can result in slower recovery of the 17 economies of the currency block. Moreover, according to a recent report, housing prices in UK rose in February, showing the first gain in 9 months, which allowed for further gains.
By MasterForex Company