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MarketsTitle:
Gold at new highs as growth fears hit markets
(Reuters) - Renewed worries about Europe's debt crisis and a raft of weak U.S. economic data hit global markets on Thursday, driving down stocks and oil prices and pushing U.S. bond yields to record lows while pushing gold to a record high.
Several U.S. economic reports added to the market's funk, with a drop in the Philadelphia Federal Reserve Bank's business activity index to minus 30.7 especially unnerving investors as it is a forward-looking indicator of national manufacturing.
The reports showed factory activity in the Mid-Atlantic region plunged in August to its lowest level since March 2009; existing home sales unexpectedly fell in July. The number of Americans seeking new jobless benefits climbed last week and consumer prices rose at the fastest pace in four months in July.
"The ...
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Gold strikes record as macro unease jolts markets
(Reuters) - Gold rallied to its second record high in a week on Thursday, driven by growing investor unease over the outlook for the U.S. economy after data showed an unwelcome pickup in inflation, and over the lack of resolution to the European debt crisis.
Asset such as stocks, corporate bonds, industrial commodities and higher-yielding currencies slid after investors lost more appetite for risk, to the benefit of gold, government bonds and the dollar itself, which many resort to in times of extreme market nervousness.
Although gold remains off its inflation-adjusted peak above $2,000 struck in 1980, it is one of the top performing assets this year, up by over 25 percent versus a 15-percent loss in U.S. blue-chip stocks .SPX or a 7.7-percent decline in the price of copper.
So far in ...
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Philadelphia Fed index slumps, home sales fall
(Reuters) - Factory activity in the Mid-Atlantic region plummeted in August, falling to the lowest level since March 2009, while existing home sales unexpectedly dropped in July, tempering hopes for a revival of economic recovery.
The number of Americans claiming new jobless benefits rose last week also and consumer prices increased at the fastest pace in four months in July, highlighting the challenges facing the Federal Reserve.
"Obviously, a very sharp contraction in orders is bad news (in the Philadelphia Fed index), " said Pierre Ellis, senior economist at Decision Economics in New York.
"It may be tied to the financial markets since the survey overlaps the last couple weeks of financial market volatility. It may have impacted corporate sentiment.
"It's hard to squeeze any good ...
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Dukascopy Afternoon Forex Overview : 18/08/2011
Previous session overview
The euro hits a session low against the Swiss franc as risk aversion grows. With gold again touching record highs and stocks in Europe slumping, investors clearly are seeking safety from an uncertain global economy and ongoing European debt problems. The euro is at CHF1.1370, from USD1.1410 late Wednesday.
Euro reversal from yesterday's high at USD1.4515 has extended at Wall Street opening, with the S&P trading 3% lower on concerns about Eurozone banks' health, and the Euro has broken below USD1.4380 day low to test USD1.4325 support area.
Gold, after having already reclaimed the USD1800 mark first reached last week, pushes to fresh highs after US CPI and weekly-jobless-claims data don't ease worries about the health of the world's largest economy. Traders ...
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Jobless claims up, gasoline lifts consumer prices
(Reuters) - The number of Americans claiming new jobless benefits rose last week and consumer prices increased at the fastest pace in four months in July, highlighting the challenges facing the Federal Reserve.
Initial claims for state unemployment benefits increased 9,000 to a seasonally adjusted 408,000, the Labor Department said on Thursday, above economists' expectations for a rise to 400,000.
Another report from the Labor Department showed the Consumer Price Index increased 0.5 percent in July, the largest gain since March, after falling 0.2 percent in June. That was above economists' expectations for a 0.2 percent gain.
Gasoline, which rose 4.7 percent after falling 6.8 percent the prior month, accounted for about half of the rise in CPI last month.
But core CPI -- excluding food ...
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Growing US Inflation Suggests QE3 Disappointment
Markets are slowly pricing in additional quantitative easing from the Fed but rising inflationary pressures suggest the central bank may be constrained to implement additional measures. Today's CPI data is all the more important for equity markets expecting a ‘Bernanke Put'.
In line with the current ultra-loose monetary policies US inflation has seen an uptick in recent months. While never officially called ‘Quantitative Easing' the Fed's policy of asset purchases to lower interest rates was designed to provide a burst of inflation to stave off potentially damaging deflationary forces. In light of QE1 and QE2 the Fed looks to have succeeded in its mission. In June consumer prices rose 3.6% y/y, up sharply from the previous three months. The headline CPI number actually declined by 0.2% ...
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Franc continues its drop, dollar advances before U.S. important data
The Swiss franc continued its drop against majors, after taking a breather yesterday, on expectations the SNB will adopt all measures to halt the franc's rally.
Yesterday, the SNB said it would raise sight deposits to 200 billion francs from 120 billion francs, repurchase outstanding SNB bills and adopt foreign exchange swaps, and it revealed that may take further measures if needed.
Today, there are talks that the bank is selling franc in forward markets, rather than spot markets, to reduce its appeal more.
Swiss Finance Minister Eveline Widmer-Schlumpf said any decision regarding a target for pegging to the euro is up to the central bank, not ruling out the possibility of seeing one of the two aforesaid options.
In the euro area, amid the absence of important fundamentals today, ...
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Busy Day for U.S. Markets with Data on inflation, Labor, Manufacturing, and Housing
A busy day awaits investors from the United States economy, where data on inflation, jobs, housing, and manufacturing activities will be released today, as investors will be hoping the data will reveal more details over the progress of the recovery, and whether the recent slowdown in economic growth will continue through the third quarter or not.
Starting with the consumer price index, where the CPI is expected to rise by 0.2% in July, compared with the prior reported drop of 0.2% back in June, while compared with a year earlier, CPI is expected to rise by 3.3%, compared with the prior rise of 3.6%.
Core CPI, which excludes food and energy prices, is expected to rise by 0.2% in July, compared with the prior rise of 0.3%, while compared with a year earlier, Core CPI is expected to rise by ...
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Gold rises towards record high, unease deepens
(Reuters) - Gold rallied back toward record highs above $1,800 an ounce on Thursday, driven by unease over the lack of a solution to the European debt crisis and sluggish growth in the developed world which has shaken investor confidence in stocks, bonds and hard currencies.
Prices have climbed to within $5 of last week's record high of $1,813.79 an ounce.
Although it remains off the inflation-adjusted peak above $2,000 struck in 1980, it is one of the top performing assets this year, up by over 25 percent versus a 15-percent loss in U.S. blue-chip stocks .SPX or a 7.7-percent decline in the price of copper.
Growth in the United States, which last week lost its top-notch credit rating, has been patchy, while European leaders struggle to contain the spread of the debt crisis that has ...
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