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Common Currency EndingTitle:
European manufacturing contracts more than expected in August
European manufacturing contracts more than expected in August, providing clues recovery is losing momentum
European manufacturing recorded contraction of 49.0 compared with July's expansion of 50.4 and media forecasts of contraction to 49.7, according to PMI final reading gauge, adding to woes that recovery is loosing momentum.
The decline was led by the ease in expansion seen in the region's largest economy, Germany, where the reading fell to 50.9 in August from the prior 52.0.
Probably, the manufacturing sector was affected by the sluggish growth pace worldwide as well as the mounting debt concerns engulfing the 17 nations using the common currency.
Chinese manufacturing started the day with an ease in expansion to 50.9 in August from 50.7.
The pace of growth in the euro area ...
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Dukascopy Morning Forex Overview : 30/08/2011
Fundamental market overview
EUR: Inflation in Germany falls
"We've probably seen the peak in German inflation"
- Lothar Hessler, an economist at HSBC Trinkaus & Burkhardt AG
Year on year consumer price index, calculated using a harmonized European Union method dropped from 2.6% in July to 2.4% in August, announced the German Federal Statistical Office on Monday. Economists expected the figure to drop to 2.5%. A decrease in consumer prices is mainly attributed to lower costs of energy and food.
"We've probably seen the peak in German inflation," said Lothar Hessler, an economist at HSBC Trinkaus & Burkhardt AG. "The ECB can sit back for now and wait and see. Slower inflation in Germany suits them quite well at the moment."
USD: Pending home sales decline
"Housing is still on the ...
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Dollar eases but could extend gains on Fed
(Reuters) - The dollar came off a two-week high against the yen on Friday, weighed down by the euro's gains on political progress in Spain, but was seen likely to recoup losses and firm further on views the Federal Reserve will not signal strong economic stimulus.
The greenback was also under pressure from the Australian dollar which gained on the Australian central bank chief's upbeat remarks about the country's economy, soothing worries over deep interest rate cuts.
Markets started the week thinking Bernanke may announce a third round of asset purchases or some other extraordinary policy later on Friday in a speech in Jackson Hole, Wyoming, pressuring the dollar. But this view has changed, giving the U.S. currency a broad boost on Thursday.
This was mostly because markets realized ...
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You Can’t Make This Stuff Up
In today’s column, I’d like to share with you a few ideas I presented at the recent Agora Financial Investment Symposium in a speech titled You Can’t Make This Stuff Up. I called it that because it’s hard to fathom serious people writing lines like this:
The renewed willingness and confidence to spend money we don’t have is vital to the continuing recovery.
That gem comes from The New York Times. Unfortunately, it reflects a common opinion. When I read stuff like that, I think we are truly doomed. I mean, is this really that hard? Spending money we don’t have is what got us into this mess in the first place!
The US debt ceiling fiasco makes that clear. The US is bleeding money. Every month requires huge amounts of financing just to keep the lights on. So far, creditors have been ...
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Dukascopy Morning Forex Overview: 23/08/2011
Previous session overview
Improvement in a gauge of Chinese manufacturing coaxed risk-sensitive currencies, such as the Australian dollar and the euro, higher against rivals in Asia Tuesday, with any strength in European economic data later likely to extend the gains.
The dollar was nearly flat against the yen. Investors avoided major bets on the greenback ahead of a U.S. Federal Reserve symposium starting Friday in Jackson Hole, Wyo. They were also cautious about the yen as Japan's Finance Minister Yoshihiko Noda kept intervention concerns alive by saying he would step up vigilance on the market.
The euro and British pound are trading slightly higher against the U.S. dollar, which is flat against the yen, as investors turn their attention to data pending more euro-zone debt news.
At ...
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The Weekly Bottom Line : 20/08/2011
The Weekly Bottom Line
HIGHLIGHTS OF THE WEEK
United States
With German growth slowing to a crawl, Europe's economy is sputtering as its ability to solve its fiscal woes is increasingly being called into question.
The U.S. economy is also showing continued signs of weakness, raising the sobering prospect that the uncertainties of the last month may have begun bleeding into the real economy.
The risk of a shallow recession is rising. However, we still feel that marginally positive growth is the more likely scenario. Once August data begins trickling in next month, we will have a better sense of the real economic damage wrought by this month's financial upheavals.
Canada
Bank of Canada Governor Mark Carney and Finance Minister Jim Flaherty were called to testify on the ...
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World stocks dip on euro zone disappointment
World stocks dipped while top-rated government bonds rallied on Wednesday as investors grew concerned that French and German plans for closer fiscal integration may be insufficient to stop the regional debt crisis from spreading further.
The Swiss franc surged against the euro after fresh measures announced by the Swiss National Bank to counter the franc strength did not contain drastic moves such as an exchange rate target which some had expected.
France and Germany unveiled far-reaching plans for closer euro zone integration on Tuesday but stopped short of increasing the size of the region's rescue fund and rejected for now the idea of a common euro bond.
Support for a common bond had been growing as it is increasingly seen as a way to allow highly indebted euro zone countries to ...
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Asian stocks fall on weak data; eyes on yen
Asian shares fell on Tuesday as sluggish U.S. and global manufacturing data added to concerns about the health of the world economy, while a strengthening yen prompted speculation that Tokyo may intervene in the markets to curb the currency.
An 11th-hour deal to raise the U.S. debt ceiling cleared its biggest hurdle in the House of Representatives, staving off the prospect of a possibly calamitous default but failing to allay fears Washington could still lose its coveted triple-A credit rating.
U.S. manufacturing grew at its slowest pace in two years in July as new orders contracted, and the economic concerns coupled with uncertainty over the U.S. debt deal boosted demand for safe-haven currencies such as the Swiss franc and weighed on riskier assets such as oil and stocks.
European ...
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Dollar skids vs Swiss franc and yen on economy fears
The dollar hit a record low against the Swiss franc and a 4-1/2 month trough versus the yen on Monday as optimism about the U.S. evading a default were swiftly outweighed by fears about the government's fiscal condition.
Republican and Democratic lawmakers were expected to vote later in the day on a White House-backed deal to raise the U.S. borrowing limit and avert an unprecedented debt default.
The deal raises the $14.3 trillion debt ceiling and cuts about $2.4 trillion from the deficit over the next decade.
"However, the risk of a possible credit downgrade remains on the table as the spending cuts may not go far enough to convince rating agencies that Washington is serious about getting its fiscal house in order," said Omer Esiner, chief market analyst at Commonwealth Foreign ...
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