Necessary To Resolving The Euro

Gold prices fell on Wednesday, unwinding the previous day's advance to a two-week peak, after data showing weaker-than-expected U.S. manufactured goods orders and cautious comments from an ECB official spurred a flurry of selling. Bullion lost ground with base metals, crude oil, equities and the euro after the report showing a moderate, though disappointing, gain in February U.S. durable goods orders ignited selling. "There's some dollar strength, it's also a risk-off kind of a day. We're seeing a lot of commodities down and stocks are down," said Rick Bensignor, chief market strategist at Merlin Securities in New York. Spot gold was down 1.3 percent at $1,658.30 an ounce by 2:50 p.m. EDT (1850 GMT), after hitting its lowest since March 23 at $1,654.50 an ounce. U.S. gold futures for ...

The euro pared its earlier losses versus the dollar after a successful Italian bond selling which saw a drop in borrowing cost, thereby providing further clues debt crisis is easing. The Italian government sold 2.82 billion euros of the zero-coupon 2014 notes with a decline in yield to 2.352%, the lowest since November compared with 3.013% at a previous auction held in February. Also, the Treasury sold 1 billion euros of inflation-linked debt maturing in 2019 and 2021 where yields recorded 3.06% and 3.45% respectively. At the meantime, there is improvement in the sentiment on hopes the euro area is on the right track towards resolving debt crisis after granting Greece with a second bailout, ECB injected more money to banks to boost liquidity and on expected expansion in European lifeline ...

Markets opened today on optimism after Bernanke's comments yesterday and after upbeat German business confidence report, yet there are some correctional movements after yesterday's gains. The EUR/USD pair is currently trading around 1.3325 after opening at 1.3357 to correct some of yesterday's advance where the pair rebounded from a low of 1.3190, where it found support from SMA 200 level, to touch a high of 1.3367. Fed's Chairman Ben Bernanke said accommodative monetary policy is necessary to spur growth and boost employment, referring that QE3 is still possible despite the recent improvement in U.S. data. His comments gave advance to shares and high-yielding currencies at the expense of safe haven assets. On the other hand, German IFO business climate for March rose to 109.8, the ...

FUNDAMENTAL OUTLOOK at 0800 GMT (EDT +0400) USD The Greek negotiations appear to be moving into the final stages as Eurogroup chairman Jean-Claude Juncker announced that a press conference is scheduled for 18.00CET on Thursday, after the Eurogroup meets. The Greek Finance Minister is due to travel to Brussels today to agree on terms, but he admitted that there are still outstanding issues ahead of today’s discussions. However, the Greek government noted that the only sticking point is on pension reform, which needs to be resolved by Greece‘s political parties. While progress has clearly been made, negotiations remain tense and further complications to the deal have emerged. The ECB’s involvement in the debt swap remains a crucial element in the process and while we expect no major policy ...

Economic Data Analysis Central Banks - Still Easing for Now Ongoing negotiations over Greek bail out, with ECB standing pat ahead of next LTRO. MPC likely to continue QE with further £50bn, but difficult judgements lie ahead. RBA to cut rates this week; easing Chinese inflation pressures could herald PBoC loosening. Another week closes with the promise of a deal on the Greek PSI debt swap. The urgency for such a deal is rising with a hard deadline of 13 February approaching. The coming week will be a question of sequencing. The coming days should see Greece agree with the Troika measures to address deficit target slippage. This needs to be done by Monday's Euro Area finance ministers meeting so it can approve Greece's second bail out package, in turn necessary to allow the ...

(Reuters) - Global equity markets and the euro slid on Monday as investors, unnerved by an Italian bond auction, doubted the ability of new governments in Italy and Greece to resolve the long-festering debt crisis in Europe. Italy paid a record euro-era high to sell five-year bonds, a day after former European Commissioner Mario Monti was named to lead the country -- a move that had been hoped would help restore market confidence. German Chancellor Angela Merkel said Europe may be living through its toughest hour since World War Two as the new leaders in Italy and Greece rushed to form governments and limit damage from the debt crisis. Merkel said she feared Europe would fail if the euro failed. But she offered no new ideas for resolving a crisis that has forced bailouts of Greece, ...

(Reuters) - The euro slid against the U.S. dollar on Monday as new governments in Italy and Greece failed to ease fears about the euro-zone sovereign debt crisis, a crisis that German Chancellor Angela Merkel termed Europe's "toughest hour since World War Two." Italy paid a euro-era high price to sell five-year bonds on Monday, just a day after former European Commissioner Mario Monti was named to lead the country -- a move that had been hoped would help restore investor confidence. News that Italian Treasury Director General Vittorio Grilli is considering resigning as early as Tuesday to take up a job in the private sector with investment bank J.P. Morgan, according to sources, added to the euro's woes. In Greece, new Prime Minister Lucas Papademos, a former European Central Bank vice ...

The Weekly Bottom Line : 14/10/2011 HIGHLIGHTS OF THE WEEK United States Markets continued to rally this week, with the S&P 500 gaining more than 5%. While encouraging, the index remains down about 3.5% on the year. The growing appetite for risk among investors stems from some policy action in Europe, diminished recessionary fears in the U.S., and signs that the Fed is ready to inject more stimulus if the economy weakens. However, the risks to the economic outlook remain largely unchanged from a few weeks ago. While the market's recent rally is encouraging, volatility is sure to remain elevated in the weeks and months ahead. Canada This week's Canadian data helped underscore our view that the Canadian economy would bounce back modestly from the small contraction ...

(Reuters) - There is little the Federal Reserve can do at this point to help a U.S. economic recovery battered by problems at home and abroad, a top Fed official said on Monday, adding that he believes it is it incumbent on politicians to attack fiscal problems. Richard Fisher, president of the Dallas Federal Reserve Bank, did not outright reject further monetary easing, but he emphasized he remains skeptical that such action would be fruitful. His comments echoed his own dissent to the U.S. central bank's decision last month to commit to ultra-low interest rates until at least 2013, a stance driven not by fears of reigniting inflation, but because he did not believe the move would do any good. "If I believe further accommodation or some jujitsu with the yield curve will do the trick ...