Fed’s Securities To Market

Consumer sentiment in the U.S. rose to 77.8 in May from the final April reading of 76.4, according to a report released by Reuters and the University of Michigan on Friday. While, the Labor Department said on Friday that its producer price index fell by 0.2 percent in April. According to Bloomberg news, Sales at U.S. retailers probably slowed in April as the weather turned more seasonable and consumers took a breather following a pre-Easter holiday buying spree, economists said before a report this week. The projected 0.2 percent gain in purchases would follow a 0.8 percent advance in March, according to the median forecast of 68 economists surveyed by Bloomberg News ahead of Commerce Department figures on May 15. Events in the U.S, likely to affect the markets this week are: Monday; a ...

Dukascopy Technical Analysis EUR/USD "If buying of Treasurys gains steam and bond yields fall in the wake of Monday's Bernanke's comments, the dollar could face more pressure against currencies such as the euro" - Societe Generale (based on CNBC) Even though the pair is trading slightly above the 1.3291/1.3325 area, it is expected to move southwards in the nearest future as the EU debt risks have not been swept away completely. EUR/JPY "The Fed’s stance to support the economic recovery through policy easing and adding liquidity to the market is helping boost sentiment" - Shinkin Asset Management Co. (based on Bloomberg) EUR/JPY rallied above the 110 level and eased the risks of bearish reversal. GBP/USD "This is more of a dollar move than a sterling move. It feels like the market was ...

Fundamental Analysis EUR "Figures clearly show that the recession in the euro zone is far from over" - Peter Vanden Houte, an economist at ING Group Euro area services and manufacturing output fell by more than expected this month, a sign the economy has slipped into recession. USD "Decline in unemployment claims is another indication that the labor market is healing. That's good news for the March payroll report" - Gus Faucher, a senior economist at PNC Financial Services The number of Americans claiming for unemployment benefits fell to 348 thousand in the week ended March 17 from the week before, said the Department of Labor on Thursday. GBP "The data puts a real dent in hopes that the consumer may be perking up appreciably" - Howard Archer, an economist at IHS Global Insight U.K. ...

The Federal Reserve Open Market Committee (FOMC) has made it official: After its latest two day meeting, it announced its goal to devalue the dollar by 33% over the next 20 years. The debauch of the dollar will be even greater if the Fed exceeds its goal of a 2 percent per year increase in the price level. An increase in the price level of 2% in any one year is barely noticeable. Under a gold standard, such an increase was uncommon, but not unknown. The difference is that when the dollar was as good as gold, the years of modest inflation would be followed, in time, by declining prices. As a consequence, over longer periods of time, the price level was unchanged. A dollar 20 years hence was still worth a dollar. But, an increase of 2% a year over a period of 20 years will lead to a 50% ...

New York Times writer, Steven M. Davidoff, recently dubbed the Federal Reserve, “the most successful hedge fund around.” After reading the article, we concluded that Mr. Davidoff is the most creative financial writer around. As such, Mr. Davidoff may be the perfect apologist for today’s dysfunctional monetary “system.” Certainly, he possesses the cerebral alacrity to dodge whatever cold, hard facts may be standing in the way of a good story. “I call the Fed a hedge fund,” Davidoff cheerily explains, “because it is operating like one, leveraging its balance sheet to earn huge profits.” We might have been able to embrace Davidoff’s analysis were it not for one nettlesome fact: the Fed is absolutely nothing like a hedge fund. The Fed is, instead, more like a crime syndicate — a racketeer ...

Fundamental Analysis EUR "The decline in euro-area December retail sales confirms our view that private consumption is likely to have fallen in the fourth quarter" - James Ashley, senior European economist at RBC Capital Markets Euro zone retail sales declined unexpectedly in December, said the European Union's statistics office Eurostat on Friday. Retail sales fell 0.4 per cent from November after declining by the same amount in October. USD "The report was much better than expected in terms of indicating fundamental strength in the economy" - Pierre Ellis, senior economist at Decision Economics The number of Americans, who have found a job in January rose to nine-month high of 243,000, said the Labor Department on Friday, pushing unemployment rate lower to 8.3 per cent, the lowest ...

Fundamental Analysis EUR " figures seem to indicate that the euro zone recession is bottoming out" - Peter Vanden Houte, an economist at ING Group in Brussels Euro-area economic confidence improved less than expected in January as the region’s economy is moving toward a recession despite leaders’ efforts to revive growth. USD "Despite the healthy gains in income, U.S. consumers appear to have rediscovered a new sense of frugality" - Millan Mulraine, an economist at TD Securities U.S. consumer spending stalled in December said Bureau of Economic Analysis on Monday, a sign consumers attempt to restore depleted savings. GBP "Housing market is dogged by uncertainty" - Richard Donnell, director of research at Hometrack U.K. month-on-month house prices remained unchanged in January, after ...

Fundamental Analysis EUR " is the main source of vulnerability of the Spanish economy" - Luis de Guindos, Economy Minister Spain’s unemployment increased to 22.8 per cent in the last three months of 2011 from 21.5 per cent the previous quarter and surpassed five million mark, said the National Statistics Institute on Friday. USD "The economy ended 2011 on a fairly positive note" - Ryan Sweet, a senior economist at Moody's Analytics The U.S. gross domestic product rose 2.8 per cent in the last three months of 2011, less then expected, the Bureau of Economic Analysis said on Friday. GBP "We’re still cautious on the outlook for equities at present" - Sally Davies, a fund manager at Octopus Investments U.K. stocks edged lower on Friday as the world’s largest economy grew less than ...

Fundamental Analysis EUR "The cost of postponing a solution is extremely high for Europe, but especially for the future of the euro" - Giovanni Bossi, chief executive officer of Banca Ifis SpA Talks on Greek debt swap resumed on Thursday as European finance ministers pressure private bondholders to take bigger losses on their Greek holdings. USD "Improving economic momentum and diminished angst surrounding the financial crisis has encouraged businesses to take on more risk" - Richard DeKaser, deputy chief economist at Parthenon Group Inc. The number of Americans claiming for unemployment benefits rose to 377 thousand in the week ended January 21 from 356 thousand the week before, said the Department of Labor on Thursday. GBP "Given the key role of consumer spending, the CBI survey ...