Eur/usd Parity On August

Citing a failure of the Congressional super committee to address the US deficit Fitch moved to change its outlook on US government debt to negative from stable. Economic News USD - Fitch Warns on US Credit Rating Yesterday Fitch warned on the US credit rating. Citing a failure of the Congressional super committee to address the US deficit Fitch moved to change its outlook on US government debt to negative from stable. Technically this means there is a chance of a ratings downgrade within the next two years. This puts Fitch on the same level with Moody's and one level above S&P who downgraded the US credit rating in August, igniting a storm in the financial markets. The move by S&P to lower the AAA rating of the US fueled sharp declines in equity markets and a rush to safe haven ...

Talk of a Greek exit from the EMU may have gone overboard. The new Greek Prime Minister Lucas Papademos has promised to carry out all of Greece's obligations to receive European bailout funds. This may help to restore fragile investor confidence in the EUR. Economic News EUR - Greek Exit from EMU Not Likely The present coalition in Greece has confirmed its intention to implement the most recent EUR 130 Bn European bailout for the country. This will be done prior to new elections. This is the type of promise investors need to help add stability to the EUR. From all the market events that have occurred over the past week, two important developments have occurred; Greece could default on its bonds and the indebted country could theoretically leave the EMU. However, with the new ...

EUR/USD The EUR/USD retreated on Thursday as the market started to lock on profits amid generally eased woes over the outlook for the euro area where investors returned to focus on the weak data and the fragile state of the global economy. Investors remain upbeat on the prospect for a resolution to the debt crisis and see leaders walking in the right path, especially after EC President Jose Barroso presented a broad plan to contain the crisis including economic governance, bank recapitalization, utilization of the EFSF, and helping Greece contain its crisis. The market though remain tensed as the plans to recapitalize banks is still not clear and with the end of the week on Friday the eyes will turn to the G20 finance chiefs meeting as they will surely discuss the development in Europe ...

Morning Briefing : Commodity-linked currencies supported by improved risk appetite What's new: Forex: Commodity currencies higher, Swiss franc under pressure Global Markets: Equity markets higher on better US consumer spending data United States: FOMC minutes due at 20:00 CET United States: Consumer spending posts largest rise in 5 months Euro zone: ECB President hawkish in speech before European parliament Forex rates in Asia and Indices: EUR/USD: 1.4533 - 1.4478 USD/CHF: 0.8188 – 0.8151 GBP/USD: 1.6423 - 1.6375 USD/JPY: 76.98 – 76.66 EUR/CHF: 1.1897 – 1.1818 EUR/JPY: 111.81 – 111.04 DowJones: 11'539.25 +2.26% NASDAQ: 2'562.11 +3.32% S & P 500: 1'210.08 +2.83% Nikkei: 8’953.90 +1.16% Shanghai: 2’573.28 -0.12% Gold: $ 1'799.80 Crude Oil: $ 87.37 Comments: Commodity-linked currencies ...

FX Strategy Weekly Market Outlook => Pro-risk currencies unfazed by EU periphery troubles; focus on G20 => BoE QIR to test sterling resilience A quiet data and event calendar means the dust should settle somewhat over global asset markets over the coming week, allowing investors to catch their breath and consider what will influence financial markets over the closing weeks of 2010. Risk appetite received a shot in the arm from the $600bln Fed Treasury purchase programme and this largely managed to neutralise escalating fears over the euro zone periphery where bond and CDS spreads hit new record highs. Though long high yield and commodity currency positions already look stretched technically, attractive yield differentials and QE flows from US into non-US assets are likely to spur ...

So far markets seem to have picked up right where they left off pre-FOMC minutes and USD rally – although the sentiment feels uninspired. The market is still digesting the FOMC minutes, dissecting & analyzing every phrase. In our collective mind, the minutes provide even less clarity than we’d been hoping for and key QE questions such as timing, size and type are all still unanswered. We have chosen to focus on two phrases: the “hinges on future economy” sentence and “that such accommodations may be appropriate before long.” Should economic data continue to stall going into November, the Fed will likely have asset purchasing on the agenda for November. The fact that the majority of members are leaning toward acting now rather than waiting around for evidence of economic erosion will ...

The US QE debate continues to drive asset prices - specifically Gold up and USD down. While the recent discord has revolved around the size of the Fed’s potential stimulus spurred by the disappointing ADP figures, we are hearing more dissenting opinions which are bringing a level of sanity to earlier predictions. The Kansas City Fed President advanced that additional QE would be more negative than positive while the newly elected Fed-Dove Yellen sounded more cautions asserting that overly loose monetary policy would encourage excessive risk taking. In addition, a slew of prominent investors, including Soros, Buffet and acclaimed analyst S.Roach, noted that monetary policy easing didn’t work the first time around and will fail again plus it may plant the seeds for further problems down ...

It’s a rather subdued start to the week after Friday’s US employment data volatility. Despite the much worse than expected figures (non-farm payrolls -95k vs. -5k expected), the pressure on US yields has failed to have a sustained impact on the FX space, and if anything, the momentum of dollar selling looks to have slowed. The weekend’s G7, IMF and World Bank meetings did not produce any decisions or outcomes worthy of a market reaction and as such we’ve kicked off the new week in a rather directionless manner. Following the holiday in Japan which limited the liquidity in the Asian session, we also have the US Columbus Day holiday and Canadian Thanksgiving holiday on the cards which is likely to have an even greater impact on liquidity into the afternoon session. Our focus is ...

Dollar Continues to Struggle Thursday, 7 Oct 2010 The slide in the value of the dollar continued today following weaker than expected ADP Non-Farm Employment change. The report showed job losses of -39K. Economists had expected the report to come in at a positive 23K. The payrolls company said the slide in private sector jobs confirms a pause in the economic recovery already evident in other data. Employment fell in all major sectors. Dollar weakness was prevalent with sharp losses occurring versus the euro. The EUR/USD was trading higher at 1.3920, up from an opening day price of 1.3846. The USD/JPY was lower at 83.00, after opening the day at 83.17. The AUD/USD was higher at 0.9765 from 0.9713. The Dow Jones Industrials Average was up 0.21% today. This follows yesterday's rally of 1. ...