Greenback Relinquishes Gains on Oil
by Korman Tam
7/30/2008 3:20:00 PM
The dollar backed away from its gains versus the majors by afternoon New York trading, relinquishing a five-week high against the euro at 1.5523 to fall back near the 1.56-handle. The greenback initially received a boost from the better-than-expected ADP private sector payrolls report but later succumbed to a combination of profit taking ahead of key US economic reports starting tomorrow and a $4.58 rebound in oil to $126.71 per barrel.
The ADP private sector payrolls defied consensus estimates for a loss of 60k jobs in July, following a 79k loss a month earlier, instead increasing by 9k jobs. Traders quickly rewarded the dollar following another bout of upbeat economic data, reacting in similar fashion to yesterday's better-than-forecast consumer confidence survey. However, the euphoria was short-lived as oil extended its rally and markets shift focus to several potentially dollar negative reports in the remainder of the week.
The US reports scheduled for release tomorrow include the advanced reading for Q2 GDP, weekly jobless claims, July NY NAPM manufacturing and the July Chicago PMI. The advanced reading for GDP in Q2 is seen improving to 2.0% from 1.0% in the previous quarter. The Chicago PMI reading is seen remaining beneath the key 50-level for the 6th consecutive month, expected to decline to 49.0 from 49.6 and highlighting continued weakness in the US manufacturing sector. Although the report has been steadily improving since hitting a 7-year low in February at 44.5, it has remain mired in contraction territory for six months and is seen slipping lower from the previous month.
Thursday, July 31, 2008
Wednesday, July 30, 2008
Bloomberg Forex News
Dollar Rises to One-Month High as Confidence Rises, Oil Falls
July 29 (Bloomberg) -- The dollar advanced to a one-month high versus the euro and the yen as U.S. consumer confidence increased and crude oil prices dropped, reducing concern the economy may fall into a recession.
The currency rose against the yen and New Zealand's dollar as unemployment climbed in Japan last month and home building permits fell to the lowest in almost 22 years in New Zealand. The pound fell versus the dollar after an index of U.K. retail sales dropped in July to a 25-year low.
July 29 (Bloomberg) -- The dollar advanced to a one-month high versus the euro and the yen as U.S. consumer confidence increased and crude oil prices dropped, reducing concern the economy may fall into a recession.
The currency rose against the yen and New Zealand's dollar as unemployment climbed in Japan last month and home building permits fell to the lowest in almost 22 years in New Zealand. The pound fell versus the dollar after an index of U.K. retail sales dropped in July to a 25-year low.
Saturday, July 26, 2008
USD 25 July
Upbeat Data Props USD
by Korman Tam
The greenback was higher in the Friday session, rallying near the 108-level against the yen and 1.5650 versus the euro on the heels of better than expected US economic reports. The data released today consisted of June durable goods orders, new home sales and the July University of Michigan sentiment survey, all of which exceeded consensus estimates.
The headline durable goods orders report increased by 0.8%, beating calls for a 0.3% decline and up from a flat reading from May, while the excluding transportations figure shot up by 2.0%, reversing the 0.8% decline a month earlier. The University of Michigan sentiment survey improved by larger than expected jumping to 61.2 and sharply improving from its 28-year low in June at 56.4. Meanwhile, new home sales also jumped to 530k units in June, edging out consensus estimates of a decline to 500k units from 512k units from May.
A combination of weak data overseas and better than expected reports from the US helped prop the dollar to one-month highs against the yen and near two-week highs versus the euro. The economic calendar for next week will provide additional news for traders to digest to gauge the state of the US economy. The reports consist of July consumer confidence, Q2 GDP, employment cost index, PCE, weekly jobless claims, Chicago PMI, July non-farm payrolls, unemployment rate, and manufacturing ISM. The US economy is seen expanding by 1.9% in the second quarter, improving from 1.0% previously. The July manufacturing ISM is estimated to bode poorly for the economy, falling beneath the key 50-level which distinguishes between expansion and contraction to 49.8, versus 50.2 a month earlier. The key highlight will be Friday's July jobs report, with the unemployment rate expected to edge back higher to 5.6% from 5.5% a month earlier.
by Korman Tam
The greenback was higher in the Friday session, rallying near the 108-level against the yen and 1.5650 versus the euro on the heels of better than expected US economic reports. The data released today consisted of June durable goods orders, new home sales and the July University of Michigan sentiment survey, all of which exceeded consensus estimates.
The headline durable goods orders report increased by 0.8%, beating calls for a 0.3% decline and up from a flat reading from May, while the excluding transportations figure shot up by 2.0%, reversing the 0.8% decline a month earlier. The University of Michigan sentiment survey improved by larger than expected jumping to 61.2 and sharply improving from its 28-year low in June at 56.4. Meanwhile, new home sales also jumped to 530k units in June, edging out consensus estimates of a decline to 500k units from 512k units from May.
A combination of weak data overseas and better than expected reports from the US helped prop the dollar to one-month highs against the yen and near two-week highs versus the euro. The economic calendar for next week will provide additional news for traders to digest to gauge the state of the US economy. The reports consist of July consumer confidence, Q2 GDP, employment cost index, PCE, weekly jobless claims, Chicago PMI, July non-farm payrolls, unemployment rate, and manufacturing ISM. The US economy is seen expanding by 1.9% in the second quarter, improving from 1.0% previously. The July manufacturing ISM is estimated to bode poorly for the economy, falling beneath the key 50-level which distinguishes between expansion and contraction to 49.8, versus 50.2 a month earlier. The key highlight will be Friday's July jobs report, with the unemployment rate expected to edge back higher to 5.6% from 5.5% a month earlier.
Friday, July 25, 2008
Bloomberg Forex News
Euro Falls Against Yen as German Business Confidence Slumps
July 24 (Bloomberg) -- The euro fell the most against the yen in more than a week as a drop in business confidence in Germany reduced speculation that the European Central Bank will raise interest rates again this year.
July 24 (Bloomberg) -- The euro fell the most against the yen in more than a week as a drop in business confidence in Germany reduced speculation that the European Central Bank will raise interest rates again this year.
Pound Tumbles
Dollar Rallies
by Korman Tam
The dollar continued to advance across the board, pushing the sterling to 1.9820 and the euro to 1.5629 in the New York session. Dismal economic reports from the Eurozone and UK dragged their respective currencies lower. While the data released in the US fared just as poorly, with existing home sales plunging to its lowest level in 10-years, much of the weakness in the economy has already been priced into the dollar and the recent pullback in oil has propped the currency higher.
US economic reports released today saw higher than expected weekly jobless claims, which jumped above the 400k level to 406k, outpacing estimates for an increase to 376k, up from 366k a week earlier. Existing home sales plunged to its lowest level in 10-years to 4.86 million units in June, missing estimates for a slight decline to 4.93 million units from 4.99 million units and down 2.6%.
The calendar for Friday includes June durable goods orders, July University of Michigan consumer sentiment, June new home sales, and building permits. Consensus estimates call for durable goods orders in June to decline by 0.3% versus a flat reading previously, while the ex-transportations orders are seen improving to -0.2% from -0.8%. The final reading for the July University of Michigan consumer sentiment survey is forecasted to remain unchanged at 56.4. Meanwhile, new home sales are seen falling to 500k units in June from 512k units a month earlier.
by Korman Tam
The dollar continued to advance across the board, pushing the sterling to 1.9820 and the euro to 1.5629 in the New York session. Dismal economic reports from the Eurozone and UK dragged their respective currencies lower. While the data released in the US fared just as poorly, with existing home sales plunging to its lowest level in 10-years, much of the weakness in the economy has already been priced into the dollar and the recent pullback in oil has propped the currency higher.
US economic reports released today saw higher than expected weekly jobless claims, which jumped above the 400k level to 406k, outpacing estimates for an increase to 376k, up from 366k a week earlier. Existing home sales plunged to its lowest level in 10-years to 4.86 million units in June, missing estimates for a slight decline to 4.93 million units from 4.99 million units and down 2.6%.
The calendar for Friday includes June durable goods orders, July University of Michigan consumer sentiment, June new home sales, and building permits. Consensus estimates call for durable goods orders in June to decline by 0.3% versus a flat reading previously, while the ex-transportations orders are seen improving to -0.2% from -0.8%. The final reading for the July University of Michigan consumer sentiment survey is forecasted to remain unchanged at 56.4. Meanwhile, new home sales are seen falling to 500k units in June from 512k units a month earlier.
Thursday, July 24, 2008
JPY Falls
JPY Falls on Downgrade, USD Edges Higher
by Korman Tam
The greenback was higher against the euro and yen, rising to 1.5669 and 107.90, respectively. The dollar continues to benefit from further declines in oil, which fell to $123.63 per barrel, and renewed confidence stemming from government measures to support Fannie Mae and Freddie Mac.
Hawkish Fed commentary has also propped the currency higher. The Fed's Plosser reiterated his view that current interest rates at 2% are pretty low and ultimately, rates have to go up. He said it was important to protect the Fed's credibility by reinforcing its commitment to low inflation through action. Plosser added that it would be too late if the Fed waited for inflation expectations to become unanchored.
Markets will look ahead to Thursday's economic reports consisting of weekly jobless claims and existing home sales. Weekly jobless claims are estimated to increase to 375k, up from 366k a week earlier. Existing home sales are seen slipping to 4.93 million in June units versus 4.99 million units a month earlier.
by Korman Tam
The greenback was higher against the euro and yen, rising to 1.5669 and 107.90, respectively. The dollar continues to benefit from further declines in oil, which fell to $123.63 per barrel, and renewed confidence stemming from government measures to support Fannie Mae and Freddie Mac.
Hawkish Fed commentary has also propped the currency higher. The Fed's Plosser reiterated his view that current interest rates at 2% are pretty low and ultimately, rates have to go up. He said it was important to protect the Fed's credibility by reinforcing its commitment to low inflation through action. Plosser added that it would be too late if the Fed waited for inflation expectations to become unanchored.
Markets will look ahead to Thursday's economic reports consisting of weekly jobless claims and existing home sales. Weekly jobless claims are estimated to increase to 375k, up from 366k a week earlier. Existing home sales are seen slipping to 4.93 million in June units versus 4.99 million units a month earlier.
Dollar Raises
Dollar Rises to Four-Week High as Fannie, Freddie Plan Advances
July 23 (Bloomberg) -- The dollar rose to a four-week high against the yen and advanced versus the euro as a U.S. government rescue of Fannie Mae and Freddie Mac moved closer to congressional passage and oil prices fell.
July 23 (Bloomberg) -- The dollar rose to a four-week high against the yen and advanced versus the euro as a U.S. government rescue of Fannie Mae and Freddie Mac moved closer to congressional passage and oil prices fell.
Wednesday, July 23, 2008
Friday, July 18, 2008
Yen Drops
Yen Declines as JPMorgan Earnings Fuel Demand for Higher Yields
July 17 (Bloomberg) -- The yen dropped against the dollar and the euro as better-than-expected earnings at JPMorgan Chase & Co. fueled investors' appetite for higher-yielding assets funded in Japan.
The yen fell 0.4 percent to 105.50 per dollar at 10:09 a.m. in New York, from 105.13 yesterday, when it weakened to 103.77, the lowest since May 27. It dropped 0.7 percent to 167.51 per euro, from 166.39 yesterday. The dollar decreased 0.4 percent to $1.5884 versus the euro, from $1.5827. It touched an all-time low of $1.6038 two days ago.
The Dollar Index on the ICE market, which tracks the greenback against the currencies of six U.S. trading partners, fell 0.3 percent to 71.875, from 72.064 yesterday, when it touched 71.508, the lowest level since April 23.
Housing Starts
Housing starts increased to a 1,066,000 annual pace last month, compared with a revised 977,000 in May, the Commerce Department reported today. The median forecast of 76 economists surveyed by Bloomberg News was for a drop to a 960,000 rate.
Federal Reserve Chairman Ben S. Bernanke told the House Financial Services Committee yesterday that growth and inflation risks are increasing and the housing market is the ``central element'' of the crisis.
The yen dropped 1.1 percent to 13.9677 against the South African rand while the Swiss franc dropped 0.5 percent to 5.8753 Swedish kronar as traders sold the currencies to buy higher- yielding assets such as stocks where returns are higher.
The Bank of Japan held its target lending rate at 0.5 percent this week, the lowest among major economies, while borrowing costs in Switzerland are 2.75 percent. In comparison, the benchmark rates are 12 percent in South Africa and 4.5 percent in Sweden.
July 17 (Bloomberg) -- The yen dropped against the dollar and the euro as better-than-expected earnings at JPMorgan Chase & Co. fueled investors' appetite for higher-yielding assets funded in Japan.
The yen fell 0.4 percent to 105.50 per dollar at 10:09 a.m. in New York, from 105.13 yesterday, when it weakened to 103.77, the lowest since May 27. It dropped 0.7 percent to 167.51 per euro, from 166.39 yesterday. The dollar decreased 0.4 percent to $1.5884 versus the euro, from $1.5827. It touched an all-time low of $1.6038 two days ago.
The Dollar Index on the ICE market, which tracks the greenback against the currencies of six U.S. trading partners, fell 0.3 percent to 71.875, from 72.064 yesterday, when it touched 71.508, the lowest level since April 23.
Housing Starts
Housing starts increased to a 1,066,000 annual pace last month, compared with a revised 977,000 in May, the Commerce Department reported today. The median forecast of 76 economists surveyed by Bloomberg News was for a drop to a 960,000 rate.
Federal Reserve Chairman Ben S. Bernanke told the House Financial Services Committee yesterday that growth and inflation risks are increasing and the housing market is the ``central element'' of the crisis.
The yen dropped 1.1 percent to 13.9677 against the South African rand while the Swiss franc dropped 0.5 percent to 5.8753 Swedish kronar as traders sold the currencies to buy higher- yielding assets such as stocks where returns are higher.
The Bank of Japan held its target lending rate at 0.5 percent this week, the lowest among major economies, while borrowing costs in Switzerland are 2.75 percent. In comparison, the benchmark rates are 12 percent in South Africa and 4.5 percent in Sweden.
Friday, July 11, 2008
Dollar Falls
Dollar Falls Versus Euro on Concern Financial Losses to Deepen
July 10 (Bloomberg) -- The dollar fell against the euro on concern losses at financial firms will deepen, prolonging the U.S. economic slowdown.
July 10 (Bloomberg) -- The dollar fell against the euro on concern losses at financial firms will deepen, prolonging the U.S. economic slowdown.
Dollar Weakens
Greenback Weakens amid Lingering Fears
by Korman Tam
The dollar was softer on Thursday, drifting lower to 1.5800 against the euro and 106.69 versus the yen. Fears of ¡°ongoing financial turmoil¡±, as described by Fed Chairman Bernanke in his Congressional testimony, continue to plague the currency. Nonetheless, Treasury Secretary Paulson tried to alleviate fears over the solvency of Fannie Mae and Freddie Mac, reaffirming that both are ¡°adequately capitalized¡±.
The US calendar was light yesterday, with just the release of weekly jobless claims, which unexpectedly improved to 346k, down from 404k a week earlier. Traders will look ahead to tomorrow¡¯s May trade deficit and the July University of Michigan consumer sentiment survey, which remains mired near multi-decade lows. The July preliminary survey is seen declining to 55.5 from 56.4, while the expectations component is estimated to fall to 48.0 from 49.2.
by Korman Tam
The dollar was softer on Thursday, drifting lower to 1.5800 against the euro and 106.69 versus the yen. Fears of ¡°ongoing financial turmoil¡±, as described by Fed Chairman Bernanke in his Congressional testimony, continue to plague the currency. Nonetheless, Treasury Secretary Paulson tried to alleviate fears over the solvency of Fannie Mae and Freddie Mac, reaffirming that both are ¡°adequately capitalized¡±.
The US calendar was light yesterday, with just the release of weekly jobless claims, which unexpectedly improved to 346k, down from 404k a week earlier. Traders will look ahead to tomorrow¡¯s May trade deficit and the July University of Michigan consumer sentiment survey, which remains mired near multi-decade lows. The July preliminary survey is seen declining to 55.5 from 56.4, while the expectations component is estimated to fall to 48.0 from 49.2.
Thursday, July 10, 2008
Wednesday, July 9, 2008
Dollar Rises
Dollar Rises as Bernanke Says Fed May Extend Lending Into 2009
July 8 (Bloomberg) -- The dollar rose against the euro for the first time in three days as Federal Reserve Chairman Ben S. Bernanke said the bank may extend securities dealers' access to direct loans into 2009.
July 8 (Bloomberg) -- The dollar rose against the euro for the first time in three days as Federal Reserve Chairman Ben S. Bernanke said the bank may extend securities dealers' access to direct loans into 2009.
Tuesday, July 8, 2008
Dollar Eases
Dollar Eases, Awaits Fed Speeches
by Korman Tam
The greenback relinquished some of its gains versus the euro and yen, falling to 1.5752 and 106.64 by the New York afternoon. Last week's payrolls report, while disappointing, was largely in line with expectations and tempered fears that the non-farm payrolls figure would reflect a similar amount of job losses as seen in the ADP private sector report. The US economic calendar this week is light, consisting of May pending home sales, weekly jobless claims, trade balance, and the July University of Michigan consumer confidence survey.
Fed speakers will dominate the headlines this week, with Chairman Bernanke and Richmond Fed Governor Lacker slated to speak today. Despite Lacker issuing hawkish commentary in recent months, the sole dissenter voting for a rate hike at the FOMC's June meeting was Dallas Fed President Fisher. Traders will closely on the comments from both Bernanke and Lacker for hints on whether the Fed will tighten policy as early as August. Given the persistent weakness in both the labor and housing market, we do not anticipate a Fed shift toward a tightening policy until Q4, at which point we look for only a 25-basis point hike.
by Korman Tam
The greenback relinquished some of its gains versus the euro and yen, falling to 1.5752 and 106.64 by the New York afternoon. Last week's payrolls report, while disappointing, was largely in line with expectations and tempered fears that the non-farm payrolls figure would reflect a similar amount of job losses as seen in the ADP private sector report. The US economic calendar this week is light, consisting of May pending home sales, weekly jobless claims, trade balance, and the July University of Michigan consumer confidence survey.
Fed speakers will dominate the headlines this week, with Chairman Bernanke and Richmond Fed Governor Lacker slated to speak today. Despite Lacker issuing hawkish commentary in recent months, the sole dissenter voting for a rate hike at the FOMC's June meeting was Dallas Fed President Fisher. Traders will closely on the comments from both Bernanke and Lacker for hints on whether the Fed will tighten policy as early as August. Given the persistent weakness in both the labor and housing market, we do not anticipate a Fed shift toward a tightening policy until Q4, at which point we look for only a 25-basis point hike.
Monday, July 7, 2008
Friday, July 4, 2008
Dollar Rallied on Trichet Comments
Euro Plunges on Trichet
by Korman Tam
The dollar rallied sharply against the euro in New York trading, rebounding from 1.5908 to beneath the 1.57-level at 1.5683. Ahead of a long weekend holiday in the US, traders digested a barrage of economic events earlier in the session prompting a sharp reversal in the euro from its 2 ½-month highs, falling by over 2 big figures.
The closely watched US labor report was largely inline with expectations, with the June non-farm payrolls slightly above forecast at -62k, from -49k. Meanwhile, the unemployment rate in June was higher than expected at 5.5% and unchanged from the previous month. Despite further losses in non-farm payrolls, the dollar found some respite since markets were preparing for an even greater loss of jobs following yesterday's unexpectedly disappointing ADP private-sector payrolls report, which declined by 79k. The June non-manufacturing ISM report missed consensus estimates, dipping beneath the key 50-level which distinguishes between contraction and expansion, to 48.2 versus calls for a smaller decline to 51.0 from 51.7.
by Korman Tam
The dollar rallied sharply against the euro in New York trading, rebounding from 1.5908 to beneath the 1.57-level at 1.5683. Ahead of a long weekend holiday in the US, traders digested a barrage of economic events earlier in the session prompting a sharp reversal in the euro from its 2 ½-month highs, falling by over 2 big figures.
The closely watched US labor report was largely inline with expectations, with the June non-farm payrolls slightly above forecast at -62k, from -49k. Meanwhile, the unemployment rate in June was higher than expected at 5.5% and unchanged from the previous month. Despite further losses in non-farm payrolls, the dollar found some respite since markets were preparing for an even greater loss of jobs following yesterday's unexpectedly disappointing ADP private-sector payrolls report, which declined by 79k. The June non-manufacturing ISM report missed consensus estimates, dipping beneath the key 50-level which distinguishes between contraction and expansion, to 48.2 versus calls for a smaller decline to 51.0 from 51.7.
Thursday, July 3, 2008
Dollar Falls to Two-Month Low Against Euro on ADP Jobs Report
Dollar Falls to Two-Month Low Against Euro on ADP Jobs Report
July 2 (Bloomberg) -- The dollar fell to a two-month low against the euro as a report showed U.S. companies shed more jobs last month than economists forecast, reducing bets that the Federal Reserve will increase borrowing costs next month.
The U.S. currency also weakened as economists predicted that the European Central Bank will raise its main refinancing rate by a quarter-percentage point tomorrow while the U.S. Labor Department will say employers eliminated jobs in June for a sixth straight month. The Australian dollar approached a 25-year high as retail sales grew at the fastest pace in six months.
July 2 (Bloomberg) -- The dollar fell to a two-month low against the euro as a report showed U.S. companies shed more jobs last month than economists forecast, reducing bets that the Federal Reserve will increase borrowing costs next month.
The U.S. currency also weakened as economists predicted that the European Central Bank will raise its main refinancing rate by a quarter-percentage point tomorrow while the U.S. Labor Department will say employers eliminated jobs in June for a sixth straight month. The Australian dollar approached a 25-year high as retail sales grew at the fastest pace in six months.
Wednesday, July 2, 2008
Non Farm Payroll - May 2008
Non Farm Payroll
Quote
“The unemployment rate in May jumped more than it has in over two decades, reaching its highest level since October 2004 and emphasizing the recessionary risk the U.S. economy is currently facing. The civilian unemployment rate spiked to 5.5 percent from 5.0 percent in April, coming in much worse than the expectation of 5.1 percent. The last time the unemployment rate jumped half a percentage point was February 1985. With nearly 49,000 jobs cut from payrolls following decreases of 28,000 in April and 88,000 in March, May marked the fifth consecutive month of job losses. Overall, the economy has shed 324,000 jobs this year.”
Unquote
Quote
“The unemployment rate in May jumped more than it has in over two decades, reaching its highest level since October 2004 and emphasizing the recessionary risk the U.S. economy is currently facing. The civilian unemployment rate spiked to 5.5 percent from 5.0 percent in April, coming in much worse than the expectation of 5.1 percent. The last time the unemployment rate jumped half a percentage point was February 1985. With nearly 49,000 jobs cut from payrolls following decreases of 28,000 in April and 88,000 in March, May marked the fifth consecutive month of job losses. Overall, the economy has shed 324,000 jobs this year.”
Unquote
Yen, Swiss Franc Rise as Stock Slump
Yen, Swiss Franc Rise as Stock Slump Pares High-Yield Demand
July 1 (Bloomberg) -- The yen and the Swiss franc rose against all of the other major currencies as stock market losses and concern global economic growth is slowing eroded demand for higher-yielding assets funded in Japan and Switzerland.
Japan's currency climbed to the highest level in almost four weeks versus the Australian dollar after the Reserve Bank of Australia said growth will weaken. The dollar pared its loss against the euro as an industry report showed U.S. manufacturing unexpectedly expanded in June for the first time in five months.
July 1 (Bloomberg) -- The yen and the Swiss franc rose against all of the other major currencies as stock market losses and concern global economic growth is slowing eroded demand for higher-yielding assets funded in Japan and Switzerland.
Japan's currency climbed to the highest level in almost four weeks versus the Australian dollar after the Reserve Bank of Australia said growth will weaken. The dollar pared its loss against the euro as an industry report showed U.S. manufacturing unexpectedly expanded in June for the first time in five months.
Forex News : ISM Dollar Firms
USD Firms on ISM
by Korman Tam
7/1/2008 2:36:00 PM
The greenback recovered against the majors in the Tuesday session following sharply better than expected US manufacturing data, pushing the currency toward the 106-level against the yen and 1.5734 against the euro. The June manufacturing ISM report defied consensus estimates for a deterioration to 48.6 from 49.6 in May, instead climbing above the key 50-level to 50.2 - which distinguishes between expansion and contraction.
Traders will turn to the Wednesday session, with the calendar to include the June ADP payrolls figure, May durable goods, new goods orders and factory orders. The June ADP payrolls figure, often viewed as a proxy for the more closely watched non-farm payrolls, is estimated to decline by 20k, versus a 40k increase in the previous month. Meanwhile, the revised May durable goods orders figure is seen unchanged with a flat reading and factory orders are seen declining to 0.4% for May versus 1.1% previously.
by Korman Tam
7/1/2008 2:36:00 PM
The greenback recovered against the majors in the Tuesday session following sharply better than expected US manufacturing data, pushing the currency toward the 106-level against the yen and 1.5734 against the euro. The June manufacturing ISM report defied consensus estimates for a deterioration to 48.6 from 49.6 in May, instead climbing above the key 50-level to 50.2 - which distinguishes between expansion and contraction.
Traders will turn to the Wednesday session, with the calendar to include the June ADP payrolls figure, May durable goods, new goods orders and factory orders. The June ADP payrolls figure, often viewed as a proxy for the more closely watched non-farm payrolls, is estimated to decline by 20k, versus a 40k increase in the previous month. Meanwhile, the revised May durable goods orders figure is seen unchanged with a flat reading and factory orders are seen declining to 0.4% for May versus 1.1% previously.
Tuesday, July 1, 2008
Forex News : GBPUSD
At 6.00 GMT
It's on the top right hand corner.
Manufacturing PMI
Nationwide Housing Prices
Disorderly Decline in U.S. Dollar
Disorderly Decline in U.S. Dollar Can't Be Ruled Out, BIS Says
June 30 (Bloomberg) -- A disorderly decline in the dollar remains a possibility as losses on U.S. assets pile up and the current-account deficit triggers ``a sudden rush for the exits,'' the Bank for International Settlements said.
The U.S. current-account deficit, the broadest measure of trade in goods, services and investment income, widened in the first quarter to $176.4 billion, the Commerce Department said on June 17. The U.S. needs to attract $1.9 billion a day from overseas to fund the gap. Foreign buying of U.S. assets rose in April to an 11-month high as total holdings of equities, notes and bonds increased by a net $115.1 billion, the Treasury Department said June 16.
The Dollar Index, which measures the currency against six major counterparts, declined 6 percent this year. The U.S. currency fell to an all-time low against the euro on April 22, when it reached $1.6019. Against the yen, it dropped to a 12- year low of 95.76 on March 17.
The Japanese currency is forecast to rise to 100 per dollar and 148 against the euro within a year, according to the median of analysts' estimates compiled by Bloomberg. The world's second-largest economy shrank at an annual 0.4 percent pace in the second quarter, a separate Bloomberg survey of 17 economists showed.
June 30 (Bloomberg) -- A disorderly decline in the dollar remains a possibility as losses on U.S. assets pile up and the current-account deficit triggers ``a sudden rush for the exits,'' the Bank for International Settlements said.
The U.S. current-account deficit, the broadest measure of trade in goods, services and investment income, widened in the first quarter to $176.4 billion, the Commerce Department said on June 17. The U.S. needs to attract $1.9 billion a day from overseas to fund the gap. Foreign buying of U.S. assets rose in April to an 11-month high as total holdings of equities, notes and bonds increased by a net $115.1 billion, the Treasury Department said June 16.
The Dollar Index, which measures the currency against six major counterparts, declined 6 percent this year. The U.S. currency fell to an all-time low against the euro on April 22, when it reached $1.6019. Against the yen, it dropped to a 12- year low of 95.76 on March 17.
The Japanese currency is forecast to rise to 100 per dollar and 148 against the euro within a year, according to the median of analysts' estimates compiled by Bloomberg. The world's second-largest economy shrank at an annual 0.4 percent pace in the second quarter, a separate Bloomberg survey of 17 economists showed.
Forex News
Traders will digest a barrage of economic events and data this week with the greenback trading on softer footing early in the Monday session, dipping to 105 against the yen and 1.5835 versus the euro. The US reports released today saw a better than forecast Chicago PMI, which improved to 49.6 from 49.1 and beating out estimates for a decline to 48.0.
Despite the holiday-shortened week in the US, markets will scrutinize several key reports including June manufacturing ISM, May durable goods orders, factory orders, non-manufacturing ISM and the June labor report. Manufacturing ISM in June is seen remaining mired beneath the key 50-level to 49.0 from 49.6 in May. Meanwhile, Thursday's labor report is seen mixed with the unemployment rate improving to 5.4% in June, down from 5.5% in May and non-farm payrolls posting another decline at -43.0k, compared with a loss of 49k jobs a month earlier.
Despite the holiday-shortened week in the US, markets will scrutinize several key reports including June manufacturing ISM, May durable goods orders, factory orders, non-manufacturing ISM and the June labor report. Manufacturing ISM in June is seen remaining mired beneath the key 50-level to 49.0 from 49.6 in May. Meanwhile, Thursday's labor report is seen mixed with the unemployment rate improving to 5.4% in June, down from 5.5% in May and non-farm payrolls posting another decline at -43.0k, compared with a loss of 49k jobs a month earlier.
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