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Currency As The Growing ConcernTitle:
Prospect of ECB money supports euro, shares
(Reuters) - The European Central Bank's upcoming cash boost for banks supported the euro and shares on Wednesday but some investors are worried the benefits of the cheap money will be short lived.
The pressure on riskier assets from oil also eased as Brent crude futures extended losses and slipped below the $124 a barrel level, ending a surge that had dampened demand for other commodities and slowed the gains in global stock prices.
Markets expect European banks to borrow about 500 billion euros ($670 billion) of the cheap funds to be offered by the ECB Wednesday, although forecasts range from 200 billion to 750 billion euros.
"The euro has priced in a cash injection of 500 billion euros and anything above 600 billion will be risk positive and push the euro higher," said Ankita Dudani, ...
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Yen bounces from multi-month lows; ECB LTRO eyed
The yen rebounded from multi-month lows against the dollar and euro on Monday as a weeks long sell-off halted ahead of an ECB debt sale that could test investors' appetite for risk.
The yen had been on a steady downward trajectory ever since the Bank of Japan eased monetary policy earlier this month. Japan's trade deficit, interest rate differentials, an improving U.S. economy and higher oil prices have also weighed on the yen.
The yen has been pummeled in February and has been the weakest performing major currency, losing about 8.15 percent in value against the euro, 5.5 percent versus the dollar and 10.5 percent against the Norwegian krona.
"Obviously we had a very strong move down in the yen and the crosses and we did not get a meaningful pause for several weeks, so we got that ...
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Oil falls after recent surge despite supply fear
Oil prices pulled back on Monday after a string of higher settlements as concerns that high oil prices might curb economic growth, along with the stronger dollar, countered supportive fears about Iran and potential supply disruptions.
Crude futures extended losses to more than $2 in post-settlement trading after Brent ended a string of five consecutive higher finishes and U.S. crude a string of seven straight higher closes.
The Group of 20 finance ministers and central bankers said on Sunday they were "alert to the risks of higher oil prices" and discussed at length the impact that sanctions on Iran will have on crude supplies and global growth.
The G20 officials also said that they welcomed a commitment from producer countries to ensure oil supplies.
The dollar index .DXY strengthened ...
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Yen hits 9-month low vs. dollar, euro holds firm
(Reuters) - The Japanese yen slid to a nine-month low against the dollar on Monday, helped by the break of a key chart level, while the euro dipped but stayed close to recent highs ahead of a fresh injection of liquidity by the European Central Bank.
The dollar rose to a high of 81.661 yen in early Asian trade, a gain of more than 7 percent since the start of month, though it later eased back to last trade at 80.85 yen, with traders citing euro/yen selling by Japanese exporters and a reported options barrier at 82 yen.
Some analysts said the dollar may have limited scope to gain much above 82 yen given there is a possibility of more monetary easing by the U.S. Federal Reserve.
"For dollar/yen to trade higher you need to see interest rates in the U.S. and other countries outside of Japan ...
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The Weekly Bottom Line : 27/02/2012
The Weekly Bottom Line : 27/02/2012
HIGHLIGHTS OF THE WEEK
United States
U.S. stock markets have been on a tear over the past several weeks reflecting newfound optimism in the economic outlook.
The housing market is leading the improvement in economic indicators and showed continued momentum this week. Existing home sales rose to levels last seen during the homebuyer tax credit of early 2010. Supported by continued job gains, the housing market looks to be turning a corner.
The one caveat to rising optimism is rising gas prices. As tensions with Iran push up crude oil prices, consumers are feeling it at the pumps. A sustained gain in oil prices presents a key downside risk to recent economic momentum.
Canada
Canada's S&P TSX, which is up a solid 3% over the past two ...
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Euro rises on German data despite dour EU forecast
The euro leaped to its highest level against the dollar in 10 weeks and to its strongest since November versus the yen on Thursday as better-than-expected German data offset a dour economic forecast from the European Commission.
The single currency retreated from highs after the EU's executive said the euro zone economy is heading into its second recession in just three years and the wider European Union will stagnate, warning that the currency area has yet to break its vicious cycle of debt.
Optimistic news about Germany, however, ultimately had investors favoring the euro.
"We're clearly in a bit of a risk-on mode following the strong German data and that should remain the main driver of activity," said Omer Esiner, chief market analyst at Commonwealth Foreign Exchange in Washington.
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Gold holds near three-month high as euro climbs
Gold rose to a three-month high on Thursday and headed for its biggest one-week rally in a month as Europe's bailout deal with Greece lifted the euro, while platinum hit a five-month peak as a damaging strike in major producer South Africa ground on.
A stronger euro, coupled with growing concern over the impact on inflation from oil trading above $120 a barrel helped spur a bid for gold ahead of an options expiry later in the day.
Spot gold was at $1,775.35 an ounce at 1500 GMT, against $1,775.79 late on Wednesday. It earlier rallied to a high of $1,784.46 an ounce, its strongest since November 15, but failed to maintain traction above $1,780 an ounce.
"(We had) technical buying yesterday with a lack of follow-through today despite support from weaker dollar," said Saxo Bank vice ...
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Rising oil, weak EU forecasts hit shares
Rising oil prices and forecasts showing the euro zone economy shrinking this year weakened European stock markets on Thursday and pulled the single currency back from 10-week highs.
More upbeat data from Germany had given shares a boost in early trade and U.S. stock futures still pointed to a firmer open, with attention focused on data expected to show a slight rise in U.S. weekly jobless claims.
But the European Commission's half-yearly forecast showed output in the 17 nations sharing the euro will contract by 0.3 percent and the broader EU bloc stagnate, putting markets back in negative territory.
"With Germany back to growth, weaker countries can benefit from increased demand for imports and should also return to some expansion later this year. However, ongoing austerity will ...
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Euro buoyed by German data, but worries linger
(Reuters) - The euro rose to a 10-week high against the dollar and its strongest since November versus the yen on Thursday after better-than-expected German data eased concerns about a bleak euro zone economic outlook.
However, the conviction that Greece's latest bailout deal will not draw a line under it or the euro zone's debt crisis was expected to limit gains for the euro, meaning the currency may struggle to hold gains above $1.33.
German business sentiment rose for a fourth month running in February, raising hopes that Europe's largest economy is improving and will avoid recession despite the problems facing indebted euro zone countries.
But the single currency came off highs after the EU commission forecast the euro zone economy to contract by 0.3 percent in 2012.
The euro was ...
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