Dec November's Trade

The European morning session has been fairly volatile for FX markets, with the euro starting off looking fairly well supported at 1.32 and then falling through the floor on the back of some weak Eurozone economic data. The first blow to the single currency came from Germany where it was reported that the unemployment rate jumped by 19,000 in April and the unemployment rate had been revised up to 6.8% from 6.7% for March, which is where it remained last month. This is the largest increase in German unemployment for three years. Although a German labour market official said the decline could be down to the timing of Easter, it was enough to spook the markets. Not such a two-speed economy? The other blow to hit the market was the fall in the German manufacturing PMI survey to 46.2, the ...

Economic Data Analysis Central Banks - Still Easing for Now Ongoing negotiations over Greek bail out, with ECB standing pat ahead of next LTRO. MPC likely to continue QE with further £50bn, but difficult judgements lie ahead. RBA to cut rates this week; easing Chinese inflation pressures could herald PBoC loosening. Another week closes with the promise of a deal on the Greek PSI debt swap. The urgency for such a deal is rising with a hard deadline of 13 February approaching. The coming week will be a question of sequencing. The coming days should see Greece agree with the Troika measures to address deficit target slippage. This needs to be done by Monday's Euro Area finance ministers meeting so it can approve Greece's second bail out package, in turn necessary to allow the ...

Weekly Economic and Financial Commentary : 21/01/2012 U.S. Review Good News on Manufacturing, Inflation and Housing The manufacturing sector remains on solid footing. Manufacturing output rose more than expected in December. Furthermore, the New York Fed manufacturing index showed the sector gained strength in January and the outlook improved further. Headline inflation continues to moderate. Producer and consumer prices both declined in December on falling food and energy prices. However, the recent rise in core inflation could tie the Fed's hands on monetary policy. Existing home sales, the housing market index and mortgage applications rose, while housing starts fell. Manufacturing on Solid Footing Industrial production rose 0.4 percent in December following a 0.3 ...

The European common currency advanced against the dollar for the fourth consecutive session, reaching two-week high, after successful bond selling in France and Spain which showed strong demand and decline in yield. Still, the main focus is on European auctions to see the ability of euro area nations to raise money to repay debt. So far, auctions from euro area nations this week are satisfying. France sold 7.965 billion euros of medium-term bonds, where it auctioned 2014 bonds with a yield of 1.05%, lower than the prior auction's yield of 1.58%. The selling for the 2015 bills reached 1.575 billion euros with a borrowing cost of 1.51% compared with 2.44% reached at November's auction. Also, 3.249 billion euros of 2016 securities were sold at 1.89% yield, down from 2.82% at November's ...

HIGHLIGHTS OF THE WEEK United States The story for the U.S. economy in 2012 is one of increased momentum facing off against strengthening headwinds. This narrative has placed economic forecasters into two camps: pessimists and optimists. As 2011 came to a close, the economic data appeared to line up in the optimistic's camp. However, over the last week, some of the bloom has come off this rosy view. Data on retail sales, net exports and jobless claims paint a less sanguine picture of the state of the economy. In Europe, negotiations between Greek officials and private bondholders over haircuts on Greek debt have stalled and several countries in core Europe have received credit rating downgrades. Canada Canadian real GDP is expected to advance by 2% annualized in the ...

Weekly Economic and Financial Commentary U.S. Review Week Two Brings a Little Less Enthusiasm Some of the optimism about housing, consumer spending and the broader economy eased back a bit this week, amid a smattering of softer economic reports. Retail sales rose just 0.1 percent in December and core retail sales fell by the same amount. Holiday sales came in right in line with our expectations, rising 5.1 percent. Weekly first-time jobless claims spiked up to 399,000 and job openings listed in the JOLTs survey fell slightly. Data on international trade and inventories also point to a more modest gain in 2011 Q4 real GDP growth. Optimism Already Appears to be Fading The New Year always seems to usher in an air of optimism and this year has been no exception. Better ...

(Reuters) - The trade deficit widened in November to its largest in five months, suggesting imports weighed on economic growth a bit more than expected during the fourth quarter. The trade gap totaled $47.8 billion, exceeding analysts' forecast of a $45.0 billion deficit, Commerce Department data showed on Friday. The government revised its initial estimate for October's trade deficit slightly lower to $43.3 billion. The trade report "is important for fourth-quarter GDP and this data should bring those (growth) expectations down," said Jacob Oubina, an economist at RBC Capital markets in New York. Imports rose 1.3 percent to $225.6 billion as Americans bought more industrial supplies from abroad and spent more on foreign oil. It was the biggest increase in imports since May, according ...

The Chinese export's growth slowed down in December, reflecting the weakening and the slowdown in global demand and pointing to Europe’s debt-crisis negative impact on the global economies. The nation's annualized exports came in line with expectations of 13.4%, yet overseas shipments recorded a retreated reading measured up with the prior reading of13.8%. On the other hand, the year's imports retreated to 11.8% compared with the prior year's reading of 22.1%; also it came below expectations of 18.0%. However, the Chinese trade balance figures showed that the surplus widened to $16.52 billion compared with the prior surplus of $14.53 billion. The prolonged European debt crisis along with cooling production and imposing property restrictions may add pressure on Premier Wen Jiabao to ...

Economic Data Analysis : 06/01/2012 A New Direction for 2012? Global risk sentiment boosted by global PMIs and US employment gains. Euro crisis still dominant theme. Neither Merkel-Sarkozy nor ECB to alter landscape. MPC to delay extending QE until next month's meeting. The first trading days of 2012 brought more upbeat news than the gloomy prognostications of end-2011 anticipated. For sure, risks of a further intensification of the Euro area crisis continue to hang over the global outlook. However, this week has seen improvement in global PMIs and record gains in US employment (albeit more subdued in the official payrolls release). This has boosted risk sentiment and key equity markets have risen in the first week of this year, with the relative outperformance of the US ...