Contributing To A Widening In The Spread

The dollar touched an 11-month high against the yen and a one-month high against the euro on Tuesday after U.S. retail sales data reinforced expectations that the Federal Reserve will not announce any new stimulus measures at the close of its meeting later in the day. The dollar recouped losses against the yen that occurred after the Bank of Japan stopped short of taking aggressive easing steps on Tuesday. Some investors had been betting on a repeat of the central bank's surprise easing last month. Commerce Department data on Tuesday showed that retail sales recorded their biggest gain in five months in February, the latest evidence of improvement in the economy that has been supporting the greenback. It followed data on Friday showing that February was the third straight month to ...

(Reuters) - Oil traded down near $114 a barrel on Monday as traders and investors worried that a failure to agree a deal with Greece for a second bailout would suppress demand in the euro zone, but renewed tensions with Iran kept a floor under prices. Greek coalition parties have yet to sign off an austerity package that will secure a second financing package from the euro zone and the International Monetary Fund, raising fears of a disorderly default. Analysts said this was putting pressure on most risk assets. "If no lending tranches are given to Greece, it would mean bankruptcy in March," said Michael Poulsen, an oil analyst at Global Risk Management. Front-month Brent crude was down 61 cents to $113.97 a barrel by 1319 GMT, ending four straight days of gains. Brent rose 2.8 percent ...

Weekly Economic and Financial Commentary U.S. Review Soft Patch Is Here The U.S. economy got off to a rough start in the second quarter, but just how rough is only now emerging from the economic data. Not only were May employment gains disappointing, but retail sales actually contracted in May for the first time since last summer. At the same time, the manufacturing slowdown that began to emerge in the May data appears to have intensified in June as the Empire State and Philly Fed surveys indicate contracting manufacturing activity in their regions for the first time since last fall. How Strong Is the Bounce Back? The string of disappointing economic data continued this week, but there were a few signs of resilience, which suggest growth could rebound a bit over the next few ...

The Weekly Bottom Line HIGHLIGHTS OF THE WEEK United States * A mixed week in equity markets as analysts parse through earnings reports. U.S. bond yields push up slightly on positive economic data. * Housing demand showing signs of life with existing home sales up 12.3% and month's supply falling to its lowest level since March 2010. * But, with shadow inventories still looming, housing starts fall to their lowest level in over a year at 529,000. * Clearing distressed properties will be key to pulling the housing market out of its prolonged stump. With rising demand, that could well happen in 2011, setting the stage for a robust recovery in 2012 and beyond. Canada * Bank of Canada holds overnight rate steady at 1.00%. * Bank cites the impact of an elevated ...

(Reuters) - The euro steadied on Thursday as dealers squared up positions ahead of a meeting of European Union leaders, while U.S. Treasuries bounced after a selloff overnight took 10-year yields above 3.5 percent, sending some investors hunting for value. Traders were wary that a discussion in Brussels about a permanent mechanism to prevent fiscal crises from spreading may push up the euro toward $1.33, though persistently higher U.S. bond yields have been keeping the dollar broadly supported in thin, year-end markets. The euro wobbled overnight after Moody's said it was considering downgrading Spain's credit rating and as a bond auction in Portugal saw its three-month borrowing costs nearly double. Spain will auction 10- and 15-year bonds later on Thursday. Shrinking trading volumes ...

Weekly Focus: Focus Turns from QE to Debt Crisis Market Movers ahead * With the European debt crisis back in focus, eyes will be on revised debt and GDP numbers from Greece on Monday in addition to Euro Group and Ecofin meetings on Tuesday and Wednesday. * In the US retail sales are expected to continue the recent trend of reasonably strong economic data. * In Japan GDP growth is expected to improve only marginally in Q3, confirming the recovery has lost considerable steam. * In Sweden the National debt office is expected to revise its borrowing requirement slightly lower. Global update * The G20-statement was basically on repeat in Seoul, South Korea with little substantial news. However, G20 gave the green light for some capital controls. * Irish bond yield ...

(Reuters) - Financial markets greeted Greek Prime Minister George Papandreou's decision not to call early national elections with relief on Monday with bond yield spreads narrowing and shares rallying, led by banks. Papandreou's threat of snap polls if his ruling socialists fared poorly in Sunday's municipal polls had unnerved markets, pressuring equities and contributing to more than 200 basis points of spread widening as investors braced for political risk in a bad week generally for peripheral euro zone countries. "Banks are showing strength, leading the broader equities market higher. Traders are relieved the worst-case scenario of early national elections is out of the picture, reducing uncertainty," said Theodore Krintas, head of wealth management at Attica Bank (BOAr.AT). At 0919 ...

Weekly Economic and Financial Commentary U.S. Review After a Dreary Week, Retail Sales Surprise on the Upside * Data this week fit the mold for how this recovery has been taking shape. Jobless claims picked up again suggesting further struggles for employment. Trade data indicated a modest drag from net exports on third quarter GDP. A bright spot was retail sales, which picked up nicely in September even as August sales numbers were revised higher. * Price data released this week showed further evidence of an environment in which producer price inflation is outpacing increases in consumer prices - not a welcome scenario for corporate profitability. Slow Inflation, Soft Exports, but a Resilient Consumer On Tuesday, markets had their first opportunity to digest the minutes from ...