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Currency Ending LowerTitle:
Risk assets slide on Portugal ratings cut
Portugal's credit downgrade to "junk" status rocked European markets on Wednesday, sending the country's government bond yields to lifetime highs and hammering the euro as it raised the specter that Lisbon may be forced to restructure its debt.
Risky assets took a beating and stayed under selling pressure after China raised its official interest rate, stoking some concerns that credit tightening in the world's No.2 economy may dampen the outlook for the global economy.
European shares slipped, snapping a seven-day winning streak, and U.S. stocks were poised to open lower a day after Moody's warned Lisbon may need a second round of rescue funds before it can return to capital markets.
Investors were already dumping risky assets ahead of a monetary policy announcement by the European ...
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The WTO admits that the restrictions imposed by China on its exports of raw materials are illegal
China is the most important economy in the Asian region and the second largest in the world after the United States due to its exports and its ability to fulfill the needs of all markets. The extended demand on its exports is also due to the local currency's low value, which make those products cheep therefore much more competitive than the products from other countries.
Therefore the Chinese exports have a large impact on world economies, even the United States, since the Chinese products and services are abundant and much more affordable, which determined China to use illegal manufacturing methods according to the World Trade Organization, in addition to the complaints received from the U.S. and the European Union and Mexico.
The World Trade Organization criticized China for imposing ...
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AUD Reluctant to Rise as China Hints at Rate Hike
The steady, and dovish, monetary policy of the Reserve Bank of Australia (RBA) served the Aussie with little support in this week's market as most participants await news from China and New Zealand to determine the direction of the AUD relative to its Pacific neighbors. It appears any negative news in Australia, or a rate hike by either China or New Zealand, will push the Aussie into a tailspin as risk aversion takes hold.
Economic News
USD - USD Bullish as China Rate Hike Weighs on Risk Appetite
The US dollar was seen increasing late yesterday as traders began to seek shelter following speculation that China may pursue a more hawkish monetary policy due to rampant inflation. The EUR/USD was seen moving towards 1.4380 yesterday while the GBP/USD was inching towards 1.6030.
The news so ...
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Dollar could be Bid on Safe-Haven Appeal
The US dollar is stronger against the majors in the Asian trading session as the shortened week will be critical for the continuation of the “risk-on” mode that was sparked last week by the passage of the Greek austerity measures and the better than expected ISM performance. Headwinds are already apparent with the rejection of the Greek debt rollover plan by S&P and a drop in some commodity prices according to a Financial Times article.
Economic News
USD - Dollar could be Bid on Safe-Haven Appeal
The US holiday celebrations are ending and US debt talks are set to begin between Democrats and Republicans. The two parties are at odds over how to raise the $14.3T debt ceiling. Republicans are steadfast in their refusal to raise taxes unless an increase in spending cuts accompanies the ...
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Retail sales in Australia unexpectedly dropped and building approvals declined more than forecasts
Retail sales in Australia declined in May opposing analyst's expectations, despite the Australian economy has started to give some optimism signals as the export of iron ore and coal to China and other Asian economies surged. This is the second drop for retail sales in three months coming after a decline in household spending affected by increasing unemployment rate.
Today's drop in retail sales may force monetary policy makers in Australia to keep interest rates at its current level at 4.75%, while the governor Stevens said that keeping borrowing costs unchanged for a year. More rate hikes still anticipated but it may be delayed for sometime as the reserve bank may find it threatening domestic demand.
Australia's retail sales index has dropped by 0.6% during the month of May, compared ...
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Risk is Back from the Brink
The Week Ahead
Highlights
Risk is back from the brink
US debt debate hits an impasse
The ECB to stick to its hawkish path
Sovereign debt concerns far from over
Sterling losing its luster
Gold looks down and out, but may offer a buying opportunity longer-term
Key data and events to watch next week
Risk is back from the brink
At the end of the prior week many key markets were sitting just above major breakdown levels and the risk was for a severe move lower. But just one week later, risky assets have rebounded and show a potential resumption of trends higher. Is all suddenly well in the world? Far from it in our opinion, and so we view the past week's rebound with a fair dose of skepticism. The sharp rebound in risk appetite was in large part a relief rally as ...
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The Weekly Bottom Line : 01/07/2011
The Weekly Bottom Line
HIGHLIGHTS OF THE WEEK
United States
The austerity measure passed in Greece on Wednesday was crucial for avoiding a default which would have threatened the integrity of the global financial system
Greek debt is concentrated in a handful of French and German banks; the subsequent failure of any one of them could affect U.S. banks as well
While the current approach to Greece does nothing to fix the country's long-term solvency issues, it does buy time for European financial institutions to shore up their capital positions
While the U.S. does not face an imminent fiscal crisis, coming up with a credible plan to tackle its own fiscal imbalances is critical for minimizing the risk of one.
Canada
Looking back at the first few months of the year, ...
Title:
Greek Default Averted for the Time Being
FX Briefing
Highlights
Greek parliament adopts austerity programme and ...
... thus meets the preconditions for further international aid
Euro profits from receding fear of Greek default
Fed stresses that interest rates will remain in place in the longer term and hints at deflationary risks
Greek Default Averted for the Time Being
The immediate danger of a Greek default has been averted. The Greek parliament has passed the medium-term austerity plan and the implementation law, while German and French financial institutions have promised to roll over major parts of the bonds maturing in the next three years. The most important preconditions for further support from the EU and the IMF have thus been met. The Eurogroup finance ministers are likely to wave through the next ...
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Equities rise, take China PMI in stride
(Reuters) - Asian equities hit their highest level in nearly a month on Friday, lifted by receding fears of a default by Greece and encouraging data from the U.S. overnight, while the euro touched a fresh three-week high.
Stocks in Asia opened the new quarter on a positive note, with the MSCI index of Asia-Pacific shares outside Japan touching its highest level since early June. The index was last up 0.4 percent at 483.13. .MIAPJ0000PUS
The markets appear to have taken weaker-than-expected China data in their stride. The MSCI's index of Asia-Pacific shares briefly trimmed gains after the announcement but later regained ground.
Financial bookmakers predicted that European shares were set to open flat to lower on Friday after hitting a near one-month high a day earlier. .EU
"Positive ...
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