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Manufacturing Confidence In The EurozoneTitle:
Dukascopy Morning Forex Overview : 15/07/2011
Previous session overview
The dollar rose slightly in afternoon Asian trade Friday after receiving a morning jolt following a warning from Standard & Poor's that it may downgrade U.S. government debt.
The move comes after Moody's said on Wednesday that its long-term rating on U.S. Treasurys was now under review for a possible downgrade. Both agencies have long given U.S. debt their highest Triple-A ratings.
S&P said that in recent months, the political debate has "only become more entangled."
The dollar dove on the news, dropping to JPY78.89 from JPY79.15 just before the announcement.
However, the greenback quickly retraced its losses. As of 0450 GMT, the dollar was at JPY79.22 from JPY79.12 in late New York trade Thursday.
The moves were mirrored in the euro, which jumped to USD1. ...
Title:
Weak US Jobs Data May Reverse Bounce in Risk
The Week Ahead
Highlights
Weak US jobs data may reverse bounce in risk
Debt concerns drill down to Europe's core
PBoC hikes rate but not yet finished as inflation remains elevated
Important technical levels to watch in the week ahead
Key data and events to watch next week
Weak US jobs data may reverse bounce in risk
'Extremely disappointing' is about the only way to characterize US June employment data. After a classic ADP-induced shift to more positive expectations on Thursday, Friday's June NFP data showed an increase of only +18K (exp. +105K) and private payrolls a gain of just +57K (exp. +132K). Worse still, the prior two months NFP were revised lower by a total of -44K, average hourly earnings were flat (exp. +0.2% MoM), weekly hours fell 0.1, and the ...
Title:
News in Rest of the World
Economic Data Analysis
News in Rest of the World
Risk aversion continues as Moody's downgrades Portugal, China hikes rates and the US debt ceiling issue ramps up.
EU17 meeting and bank stress test results maintain focus on Europe this week.
July's first US business and consumer surveys may show evidence that soft patch is ending. Bernanke's semi-annual Congressional testimony to update Fed view.
UK CPI inflation likely stays at 4.5% in June.
The periods of market recovery post Eurozone crises have become increasingly brief. The relief rally that followed the passage of Greek austerity measures pulled up short in the last week with Moody's downgrading Portuguese sovereign debt to 'junk' status. While the ECB suspended Portugal's collateral rating requirements at its ...
Title:
Forex - Portugal’s Relegation to Junk Reminds Markets of EUR Risks
Forex News and Events:
It seems that yesterday`s Moody’s downgrade of Portugal has finally caught up to risk appetite. After a sleepy summer, US and early Asian sessions, we are starting to see heavy selling in risk correlated trades. EURUSD fell sharply to 1.4402 from 1.4467, while EURCHF, our European crisis barometer, dropped to 1.2101. Asia regional indices were in the red and the negative sentiment has spilled over into European trading. Moody's hacked Portugal's sovereign rating by 4 notches to Ba2, the outlook is negative, placing the sovereign debt into non-investment grade territory. Moody’s stated that the rationale for the aggressive adjustment was due to the “risk that Portugal will require a second round of official financing" and, the "growing possibility that private ...
Title:
Risk is Back from the Brink
The Week Ahead
Highlights
Risk is back from the brink
US debt debate hits an impasse
The ECB to stick to its hawkish path
Sovereign debt concerns far from over
Sterling losing its luster
Gold looks down and out, but may offer a buying opportunity longer-term
Key data and events to watch next week
Risk is back from the brink
At the end of the prior week many key markets were sitting just above major breakdown levels and the risk was for a severe move lower. But just one week later, risky assets have rebounded and show a potential resumption of trends higher. Is all suddenly well in the world? Far from it in our opinion, and so we view the past week's rebound with a fair dose of skepticism. The sharp rebound in risk appetite was in large part a relief rally as ...
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Weekly Economic and Financial Commentary : 01/07/2011
Weekly Economic and Financial Commentary
U.S. Review
Second Quarter Ends Poorly - Better Times Ahead
Weaker-than-expected consumer spending and income growth for May are causing many economists to further scale back their consumer spending and GDP growth forecasts for the second quarter. Expectations for a second-half growth rebound remain intact, however, although the evidence to date remains scant.
U.S. manufacturing gains remained modest in June if the ISM manufacturing and regional manufacturing surveys are to be believed. On the bright side, capital and durable goods orders rebounded strongly in May increasing the odds of a manufacturing rebound in Q3.
More Disappointment in the Third Quarter?
Economists are counting on a solid third quarter bounce in GDP growth in part ...
Title:
Soft data out of Asia
USD
Data out of Asia was broadly soft overnight, giving risk trades a mild knock though equities are faring well. Safety plays have started the European session relatively robust as growth fears remain in place. In addition to a soft Japanese Tankan, Chinese PMI also came in softer than expected at 50.9, the lowest since Q1 2009. However, Australian data was stronger. The focus today will be on PMIs out of Europe and also the US, where manufacturing ISM is due. Indications are mixed so far. Yesterday the Chicago PMI surprised strongly to the upside at 61.1 (cons. 54.4) and the NAPM-Milwaukee June PMI also printed higher at 59.3 vs. 59.0 expected. However, earlier regional prints were softer. In other news, Bloomberg reported that current Treasury Secretary Geithner may leave his post ...
Title:
EMU Economic Indicators Preview : Week of 27 June to 3 July 2011
EMU Economic Indicators Preview
(Week of 27 June to 3 July 2011)
German CPI inflation (Jun): unchanged
EMU economic sentiment and industrial confidence (Jun): unchanged
M3 money supply growth (May): accelerating slightly
German retail sales (May): unchanged or better
German labour market (Jun): unemployment set to continue its decline
EMU inflation flash estimate (Jun): unchanged
June Italian business confidence and July German GfK consumer climate will probably have deteriorated, but the EMU economic sentiment and industrial confidence could have remained more or less unchanged in June, as the corresponding national indicators sent mixed signals. The eurozone consumer confidence and the Purchasing Managers' Indices for the manufacturing sector in Germany and in ...
Title:
Litmus test for U.S. factories, Greece
(Reuters) - The U.S. economy has decelerated sharply. A snapshot of the nation's manufacturing sector this week should help reveal whether the slowdown is temporary or the start of a trend.
Federal Reserve Chairman Ben Bernanke argued last week that the second half of the year would be better than the first. But a downward revision in the central bank's forecasts for economic growth for this year and next belied a lack of conviction.
Europe's debt debacle remains a major cloud over the global growth, with the latest installment of Greece's bailout drama doing little to persuade investors that the country will be able to avoid a painful default.
In this context, the Institute for Supply Management's survey of U.S. manufacturing, often a leading indicator of broader economic activity, ...
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