Dollar Failed To Regain

Investors continue to limit their risk exposure on Thursday, heading towards the safe haven dollar and the Japanese yen, as European leaders failed to adopt concrete actions during yesterday’s summit while manufacturing in China is seen shrinking for a seventh month in May according to HSBC. With the risk of Greece exiting the euro zone not being eliminated by officials yesterday, the sentiment is seen negative, pushing the euro near the lowest since July 2010, especially after Italian Prime Minister Mario Monti backed French President Francois Hollande’s proposal of jointly underwrite regional bonds that Germany still opposes. The risk remains subdued and markets trade with volatility today as data may show that Europe’s services and manufacturing industries shrank for a fourth month, ...

Investors continued to limit their risk exposure on Thursday, heading towards the safe haven USD and the Japanese yen, as European leaders failed to adopt concrete actions during yesterday's summit while manufacturing in China is seen shrinking for a seventh month in May. With the risk of Greece exiting the euro zone not being eliminated by officials yesterday, sentiment is seen subdued, pushing the euro near the lowest since July 2010, especially after Italian Prime Minister Mario Monti backed French President Francois Hollande's proposal of jointly underwrite regional bonds. Sentiment may continue to be subdued and markets volatile today as data may show that Europe's services and manufacturing industries shrank for a fourth month, while Germany`s IFO business climate index, a key ...

Sunrise Market Commentary - Fixed Income: Core bonds higher at first, but gave back gains in US session - Fears about Greece and Spain continued to boost core bonds, but a rumours, later confirmed, that the EFSF would today disburse a tranche of the Greek bail-out loan triggered some correction and erased part of the German bond gains and almost all of the US ones. Today, the BoE decision on QE may affect overall bond markets. - Currencies: euro extends its trip South as speculation on Greek exit is growing - On Wednesday, trading on global markets was still dominated by negative headlines on Europe. This weighed on the euro. After all, the decline of EUR/USD developed in an orderly way even as several EMU policymakers pondered the option of a Greek exit. Today, the BoE holds ...

Sunrise Market Commentary - Fixed Income: Small changes after volatile trading - Core bonds traded volatile due to economic data and bond auctions. The Fed had the final saying. The FOMC statement showed that the Fed was slightly more optimistic on growth and the governors more hawkish in their rate forecasts. However, policy remains unchanged and Bernanke kept the door for more QE open. - Currencies: Fed doesn't help the dollar - On Wednesday, trading in most major currency cross rates was confined to recent ranges. EUR/USD is holding near the recent highs. The Fed kept a soft tone and this was a slightly negative for the dollar. Sterling lost temporary ground as Q1 GDP data showed that the UK has slipped back into recession. However, the EUR/GBP 0.8222 resistance did its job. ...

Sunrise Market Commentary - Fixed Income: the only way was up - Political tensions in the Netherlands and France in combination with weak PMI data set the tone for a risk off environment in which especially German bonds profited. The Bund set a new contract high and the German 10-yr yield set a minor record low (1.63%). The Dutch spread added 18 bps (78 bps) and is well underway to a the all time high (86 bps). - Currencies: EUR/USD showed only limited losses even as risky assets were sold - On Monday, EUR/USD ceded ground as negative political and economic headlines from Europe weighed on global market sentiment. However, investors were also cautious on the dollar ahead of tomorrow's Fed decision. Sterling was again an outperformer as EUR/GBP reached a new correction low. ...

Sunrise Market Commentary Fixed Income: Political developments supportive for core EMU bonds Political developments over the weekend are supportive for global core bonds, but strong technical resistance (contract high; inverted channel) come into play. In France, presidential candidate Hollande beat current president Sarkozy in the 1st round of the French election and in the Netherlands, the government fell as Dutch budget talks collapsed. Currencies: EUR/USD fails to take out first resistance at 1.3213 On Friday, the euro was rather well bid. EUR/USD tested the 1.3213 resistance but failed to sustain above this level. EUR/GBP stayed below the 0.8222 previous range bottom, confirming the break of earlier last week. Cautious sentiment on risk will probably cap the topside ...

The most anticipated release of the session was flash Chinese manufacturing PMI data, which provides the market with an insight into the private manufacturing sector in China and, in turn, the domestic economy. Yet, the biggest market moving event of the session was PPI data out of Australia which printed well below consensus estimates, resulting in the market shedding the aussie as investors priced in an increased chance of a rate cut next month. Manufacturing PMI inched closer to expansion territory in April according to a survey released by HSBC, coming in at 49.1 from the prior 48.3. Reaction in the FX market was limited, however, due to the indistinct nature of the print, with some investors taking the data as a sign the Chinese economy is on the right path but others pointing ...

The U.S. dollar maintains its earlier gains seen today with the risk-off sentiment taking over the reins anew after china’s data. Specially that Inflation data came no surprise; as prices on the consumer front within the U.S remained almost unchanged; the Consumer Price Index ticked 0.1% lower in March to 0.3% from 0.4% in February, while the core component which excludes food and energy ticked 0.1% higher to 0.2% in line with estimates from 0.1% in February. The USD index is current attempting to retest the breached descending triangle we mentioned previously after completing the awaited retest of the 50-days SMA yesterday. Now a push above 79.60 could extend gains towards the descending resistance of the triangle once more around 79.90 level. The EUR/USD was one of the weakest today; ...

Gold inched higher on Thursday after falling to a near three-month low the previous day as weaker prices tempted some buyers, but gains were capped by a stronger dollar and fading hopes for a fresh round of monetary stimulus in the United States. Spot gold was up 0.2 percent at $1,622.30 an ounce at 7:21 a.m. EDT (1121 GMT), while U.S. gold futures for June delivery were up $9.60 an ounce at $1,623.70. The metal has fallen nearly 3 percent this week and while prices regained some ground on Thursday, it was still hovering around its lowest since early January. Traders are awaiting key U.S. payrolls data due on Friday for fresh direction. "You have the release of the U.S. labor report tomorrow so there is some risk over the weekend," said Peter Fertig, a consultant for Quantitative ...