Above Parity Reaching

Fundamental Analysis EUR "Spain, once again, is where the confidence game is played" - Sebastian Paris Horvitz, strategist at HSBC Private Bank Suisse Spain sold the maximum targeted amount of debt, 2.5 billion euros, during yesterday’s auction with spiking borrowing costs. The interest rate of three-year bonds rose to 4.373% from April’s figure of 2.89% while interest rate of five-year bonds surged to 5.106% from 3.374 in March. USD "What we’re seeing in foreign-exchange markets is strong demand for the U.S. dollar" - Steven Saywell, head of foreign-exchange strategy for Europe at BNP Paribas SA Latest US initial unemployment claim data was released yesterday – 370 000 Americans demanded their jobless benefits last week versus a 368 000 consensus forecast. The Labor Department revised ...

USD Softer as Sentiment Stabilizes USD is mostly softer as sentiment stabilizes and amid slightly weaker US economic data. Weekly initial jobless claims dropped by 1k to 367k (cons. 368k) from an upwardly revised 368k (prior 365k). The 4-week moving average in initial claims fell for the first time in 5 weeks with a drop of -5.3k indicating marginal improvement in labor. The March trade balance showed a wider than expected deficit of -$51.8B (cons. -50.0B, prior -45.4B) as imports jumped 5.2% – the largest increase in over a year. European bourses are currently trading in positive territory, US stock futures are suggesting upside at the open, and UST yields are higher across the curve indicating a better risk environment today. The dollar index is lower and testing the 80.00 figure as ...

The markets have managed to shrug off some fairly dismal services sector PMI data from the Eurozone, as the US non-farm payrolls data comes into focus. Arguably the most important economic data release of the month, the markets expect 160k but our prop model suggests a slightly weaker reading of 136k. Labour market data in April was fairly mixed but the overall bias was to the downside with the 4-week moving average of initial jobless claims rising more than20k over the month. Payrolls reports have the power to set the tone for how markets, and the dollar in particular, trade for the rest of the month. The weaker March NFP report stopped the rally in USDJPY in its tracks, for example. So what can we expect from today's report? Essentially the magic number is 200k – this is the amount of ...

Fundamental Analysis EUR "Ifo index paints a too positive picture of the growth prospects for the German economy" - Carsten Brzeski, senior economist at ING Group German business confidence unexpectedly improved in April, a sign the euro zone’s largest economy is weathering Europe’s debt crisis. Ifo business climate index, which is based on a survey of 7,000 businesses, rose to 109.9 points from 109.8 points in March. USD "A strong Germany helps the euro massively, and helps other assets too" - Neil Jones, head of European hedge-fund sales at Mizuho Corporate Bank Ltd. U.S. stocks closed mixed on Friday while German investor confidence unexpectedly improved and blue chip companies from General Electrics to Microsoft reported better than expected earnings. GBP "While the month of March ...

Fundamental Analysis EUR "The debt crisis is far from over still and I think Spain will be worse before it gets better" - Henrik Drusebjerg, a senior equity strategist at Nordea Bank AB Spain sold 2.54 billion euros of debt dated 2014 and 2022 on Thursday, above the target range of 1.5 to 2.5 billion euros for the auction. USD "Progress in the labor market is not quite as strong as people had hoped, but we are still on a recovery track here" - Scott Brown, chief economist at Raymond James & Associates Inc. The number of Americans claiming for unemployment benefits declined by 2,000 to 386,000 in the week ended April 14 from the week before, said the Department of Labor on Thursday. GBP "Economic data does look like it is showing some stabilization" - Samantha Fitzpatrick, senior ...

Fundamental Analysis EUR France and Spain plan to assemble EUR 13.5 billion (USD 17.6 billion) in bill auction today as Spanish PM Rajoy struggles to reduce budget deficit and presidential elections in the France drive yields up. France is issuing 2017 bills and 2018 inflation linked notes, a maximum target of EUR 11 billion while Spain is planning to raise EUR 2.5 billion in 2-year and 10-year bonds. USD The IMF announced that it has secured 320 billion US Dollars in drive for increasing the fund's lending capacity. Switzerland and Poland have already contributed to the fund expansion. The IMF hopes to raise about 400 billion US Dollars in commitments from countries around the world. The move followed surging borrowing costs of Italy and Spain that escalated concerns over the Euro ...

Dukascopy Fundamental Analysis EUR European industrial production fell in December, weighted down by a drop in Germany, fuelling concerns the region might be entering in a new recession wave. The output in Euro Zone declined 1.1% in December compared to November. Analysts predicted a decline of 1.2%. On yearly basis production diminished 2%. USD A significant drop in automobile sales caused a slide in the amount of overall retail sales in January, Commerce Department reported today. Retail sales rose less (+0.4%) than expected (+0.8%). However, sales excluding automobiles increased by 0.7%, the greatest climb since March, 2011. GBP UK consumer prices posted a 0.5% monthly drop in January, said the UK National Statistics Office on Tuesday. The annual consumer price index slowed from 4.2% ...

The Weekly Bottom Line : 05/02/2012 HIGHLIGHTS OF THE WEEK United States U.S. economic indicators for January point to renewed momentum in early 2012. Non-farm payrolls expanded by a vigorous 243K, and the unemployment rate fell to 8.3%. Vehicle sales rose 4.6% to 14.1 million (SAAR) in January, reaching the highest level in over three and half years and surpassing the one-time shot in the arm provided by the cash for clunkers stimulus program. ISM manufacturing and non-manufacturing indexes posted strong gains and, as leading indicators, give hope that January's performance could be maintained in the month's ahead. Despite the positive turn in the data, 2012 will remain a challenging year for economic growth. The housing market and European recession present key ...

Morning Briefing : Riskier currencies nurse previous losses What's new: Asia: US and Asian equities in positive territory United States: Stronger than expected US data helps lifts spirit at week- end Spain: Well received debt auction yesterday eases concerns SNB: Remains on hold no policy changes FOREX: Commodity bloc currencies regain favour remain supported this morning Forex rates in Asia and Indices: EURUSD: 1.3044- 1.3006. USDCHF: 0.9413 – 0.9378. GBPUSD: 1.5544- 1.5502. EURJPY: 101.57 – 101.31. USDJPY: 77.93 – 77.79 DowJones: 11’868.81 +0.38% NASDAQ: 2’541.01 +0.07% S & P 500: 1’215.75 +0.32% Nikkei: 8’401.72 +0.29% Shanghai: 2’224.84 +2.02% Gold: $ 1'593.70 Crude Oil: $ 94.30 Comments: Positive US data and well concluded Spanish debt auction helped lift risk sentiment, ...