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Europe’s Debt CrisisTitle:
China pledged again to support growth
China’s leaders pledged to focus on growth and support the nation’s economy after amid slower domestic demand and Europe’s debt crisis that negatively affected global demand.
China’s government said in the second governmental statement in four days that it will take implement measures that will rebound domestic demand and create a suitable environment for stable and sustained economic growth.
Monetary policy makers in China are working hard to find new methods to support the nation’s growth. They recently lowered the cash reserve requirements for banks, alongside lower taxes for companies.
Meanwhile, the moderating inflation is not only giving more space for officials to adjust their policies accordingly, but it also encourage consumera to increase their spending, which could support ...
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Dukascopy Afternoon Forex Overview : 23/05/2012
Fundamental Analysis
EUR
German bunds rose on worries that European leaders will struggle to resolve the euro zone debt crisis during tonight's European summit. David Schnautz of Commerzbank AG in London thinks that Europe is unlikely to solve key topics and will probably disappoint the market. The 5-year bund lost 5 bp to 0.47 percent at 10:49 GMT after tumbling to 0.461 percent, the lowest since 1990, when Bloomberg began gathering data.
USD
Crude oil futures declined in Asian session on Wednesday as Iran is ready to invite nuclear inspectors, the move that may ease oil import sanctions. Light, sweet crude oil futures for July delivery traded at 91.27 US Dollars per barrel, retreating by 0.63% from the last session's high of 91.72 US Dollars per barrel.
GBP
Today the minutes of the ...
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Asian stocks driven lower by downgrades in China, Japan ahead of EU summit
Ahead of a meeting of European leaders, the MSCI Asia Pacific Index dropped 1.5% at 12:31 in Tokyo after investors lost their appetite for risk after they were spooked by the mounting worries over Greece exiting the eurozone, while BoJ held its monetary policy unchanged although growth is slowing.
Greece’s former Prime Minister Lucas Papademos said yesterday that while it is unlikely that the nation will leave the eurozone, the risks are still high. And if this would prove to be the case, other countries may follow, warned Jin Liqun, chairman of China Investment Corp.
Meanwhile, one day after Fitch cut the Japan’s rating by one notch to A-plus from AA with negative outlook, citing “high and rising public debt” burden, Japan showed a slowdown in its exports during April, adding to ...
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World Bank: Asia must watch inflations closely
The World Bank noted that policy makers in Asia’s emerging economies should watch closely inflation rates and working hardly on keeping inflation in targets, adding that inflation is the main tool of controlling the nation’s growth where the bank sees the slower pace of Asia’s growth.
Adding that, many of Asian policy makers whom have cut interest rates this year, are under pressure to support growth especially amid the current threats of Europe’s sovereign debt crisis.
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Bank of Japan kept interest rates at zero levels
Bank of Japan decided to keep the interest rates unchanged at zero levels between 0.0% and 0.10%, matching analysts’ expectations especially amid the current challenges that face the Japanese economy.
On the other hand, BOJ kept the credit lending program at 30 trillion yen, and kept the asset purchase program unchanged at 40 trillion yen, disappointing markets as officials intend to save such actions for the upcoming months if conditions get worse due to Europe’s debt crisis.
However pressures are increasing on policy makers after Fitch downgraded Japan’s sovereign debt on Tuesday due to the rising debt-to-GDP ratio, and pointed to the importance of raising taxes.
Japan must keep its pledge to start raising sales taxes by 2014 to control its public debt which is expected to exceed 220% ...
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BOJ’s rate decision
Bank of Japan decided to keep the interest rates unchanged at zero levels between 0.0% and 0.10%, matching analysts’ expectations especially amid the current challenges that face the Japanese economy.
On the other hand, BOJ kept the credit lending program at 30 trillion yen, and kept the asset purchase program unchanged at 40 trillion yen, disappointing markets as officials intend to save such actions for the upcoming months if conditions get worse due to Europe’s debt crisis.
Bank of Japan expects the nation’s economy to return to growth during the upcoming period even if in a slower pace, alongside the continued worries over Europe’s debt crisis; meanwhile, the bank sees that higher growth rates will control deflation.
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China’s leading index rises supporting investor’s confidence
China witnessed on Tuesday a rise in the country’s leading index in April by 0.8%, matching the previous reading and supporting investor’s confidence, as it improves the prospects for growth.
Today’s reading comes amid the uncertainties over the nation’s growth mainly due to Europe’s debt crisis, which lowered demand on exports and the outlook for growth.
China’s government pledged to focus on growth especially as inflation seems to be moderating, where further easing in the monetary policies are expected in the upcoming months.
Monetary policy makers in China are working hard to find new methods to support the nation’s growth. They recently lowered the cash reserve requirements for banks, alongside lower taxes for companies.
Meanwhile, the moderating inflation is not only giving more ...
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Euro Rebounds But Still Under Pressure
The euro (EUR) edged higher to 1.2812 rebounding from a four-month low at 1.2641 against the US dollar. The single currency tumbled on Friday on concerns over Greece’s political uncertainty as well as growing instability in the Spanish banking sector. European leaders of G8 met during the weekend to discuss steps needed to fight Europe’s debt crisis and reaffirmed the importance that Greece remains in the eurozone. G8 leaders also focused on ways to stimulate eurozone growth but no detailed plans on how to resolve the problems were announced. But the single currency remains under pressure as investors are worried about a messy Greek default and exit from the euro ahead of a repeat election in June 17.
The US dollar (USD) stumbles against a basket of currencies as sentiment in the market ...
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Asian stocks returned to losses on collective downgrades including Spanish banks, Greece and China
As Europe’s debt crisis is threatening the global recovery, market participants limited their risk exposure while some inventors locked on to their profits ahead of the weekend, driving the Asian stocks lower where the MSCI Asia Pacific Index dropped 2.2% at 11.28 in Tokyo, and is down 0.8% this year.
Global equity markets lost almost $4 trillion dollars this month as Europe’s debt crisis is worsening threatening the global economic stability. Moody’s downgraded 16 Spanish banks on Thursday after the nation fell into recession during the first quarter while loan losses are mounting.
Meanwhile Fitch Ratings downgraded Greece by one notch to CCC from B- since its political deadlock is pushing the country out of the euro zone, as attempts to form a new government failed, leading to new ...
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