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Business confidence in Europe`s largest economy unexpectedly improved in May, as German executives and manufacturers see brighter prospects for the second quarter of this year after national output grew, but a markedly slow rate. The IFo Institute published its monthly surveys of Germany business confidence, capping a busy day for Europe`s largest economy. Earlier today, the Gfk Consumer Confidence Survey and German Gross domestic Product final estimate were out. The Ifo surveys were the best! German business confidence rose in May following three months of declines. The Ifo Business Climate Index was at 105.7, up from 104.4 in April, beating analysts` average forecast of a no change. The euro jumped against the dollar on the good news, hitting a session high of $1.2986 as of 11:29 GMT+ ...



Asian Market Update Japan stocks rebound from overnight collapse as yen-sellers resurface Economic Data (NZ) NEW ZEALAND APR TRADE BALANCE (NZ$): 157M V 515ME (3-month low); EXPORTS: 3.95B V 4.06BE; IMPORTS: 3.80B V 3.60BE (PH) PHILIPPINES MAR TRADE BALANCE: -$593M V -$967M PRIOR; TOTAL IMPORTS: $4.9B V $4.7B PRIOR; TOTAL IMPORTS: -8.4% V -5.8% Y/Y Markets Snapshot (as of 02:30 GMT) Nikkei225 +2.9% S&P/ASX -1.3% Kospi +0.1% Shanghai Composite +0.3% Hang Seng flat Jun S&P500 +0.2% at 1,653 Jun gold +0.1% at $1,393/oz Jul crude oil flat at $94.25/brl Observations/Insights Outsized losses in Tokyo equities are being corrected in the final session of the week as traders swooped in to put a floor under the free-fall in the yen pairs overnight. Yen selling has returned amid the ...



The EU leaders continue to push through to tackle major issues in the region that suffers still from anemic growth and uncertain outlook as the euro area debt crisis takes a toll on the region’s entire 27 economy. The EU summit on Wednesday focused on tax evasion and means to improve the taxation system. In the EU according to statistics tax evasion and avoidance cost for the EU 27 is nearly 1 trillion euros a year. A European Parliament resolution on tax evasion Tuesday urged the leaders to halve the trillion annual losses by 2020 by curbing the loopholes and havens. The EU leaders stressed on the need to tackle tax evasion and at the same time push for global action against bank secrecy; the key is also to prevent firms from taking advantage of loopholes to avoid taxes. At the ...



First-tier economic fundamentals from Europe take center stage on Thursday, as traders look for fresh updates about the state of the euro-area manufacturing and services sectors. Market participants are welcoming one heavy doze of news today, as France, Germany and the euro area prepare to fresh up the run way with the latest PMI data; expected to hover around the same level, and of course confirming the stubborn setbacks of the 17-nation euro bloc. - France Manufacturing PMI (MAY P) estimate at 44.8 vs. 44.4, Services PMI (MAY P) estimate at 44.5 vs. 44.3 - Germany Manufacturing PMI (MAY A) estimate at 48.5 vs. 48.1, Services PMI (MAY A) estimate at 50.0 vs. 49.6 - Euro-Zone Composite PMI (MAY A) estimate at 47.2 vs. 46.9 The euro and stocks have been under hectic pressure ...



- There were no major surprises in connection with today's Bank of Japan (BoJ) meeting and the market impact should be neutral. The expansion of the monetary base (now the main policy instrument) was maintained at JPY60- 70trn. In addition BoJ as expected upgraded its view of the economy and now believes that the economy has started to recover. - Interestingly enough there was no mention of bond yields in the statement, suggesting that BoJ does not regard the recent increase in government bond yields a major problem. Rightly so in our view, as the increase in bond yields has been more than offset by higher inflation expectations. However, inflation expectations remain substantially below the 2% targeted by BoJ and hence the increase in bond yields cannot so far justify a scaling down of ...



The Hungarian forint advanced today, breaking the level above which Goldman Sachs recommended their customers to close sell positions. The breakout added to the upward momentum of the currency. The Vietnamese dong rallied today as central bank Deputy Governor Nguyen Dong Tien said that an interest rate cut is unlikely to happen this year amid the ongoing banking reform. Tien said yesterday: The pressure on inflation still remains and there are still some factors that will cause inflation to quicken toward the end of the year. A further rate cut by the central bank is difficult. There’s a small chance. Such words boosted the currency that was moving largely sideways. USD/VND fell from 20,920 to 20,845 as of 12:37 GMT today.



The Hungarian forint advanced today, breaking the level above which Goldman Sachs recommended their customers to close sell positions. The breakout added to the upward momentum of the currency. Goldman predicted last month that the forint would fall and recommended that clients to close positions if the currency appreciates beyond the 290 per euro level. The forint was rallying as the Hungarian economy expanded 0.7 percent in the first quarter of 2013 from the previous three months, demonstrating the first quarterly growth in more than a year. The forint has rallied 5.3 percent in the second quarter, the best performance among the most-traded currencies. USD/HUF went down from 224.3300 to 223.7900 as of 10:39 GMT today. EUR/HUF declined from 289.6500 to 289.3350, reaching the low of 288. ...



GBP Gets A Pounding It's been a rough morning for GBP, with economic data thwarting early attempts at a GBP recovery. BOE minutes, retail sales and public sector data all weighed on the pound, pushing it below 1.5100 – a key support level. Data details: - BOE minutes were as expected: 6-3 vote to keep QE on hold. This reinforces he view that the BOE is practically in limbo until Mark Carney takes the helm in July. - Retail sales ex auto fuel fell 1.4% in April; the main downward pressure came from a decline in food sales, which fell 3.8% from a year earlier. - Cold weather was blamed for poor sales, particularly bbq food and garden furniture. - Online retail sales were strong, and now make up a tenth of all sales. - Public sector finances for April: this was important ...



European Market Update UK retail sales data comes in negative and well expectations; markets ahead Bernanke testimony for hints of QE tapering Notes/Observations Bank of Japan (BoJ) leaves policy unchanged (as expected). Upgrades economic outlook for 5th straight month Japan Apr trade deficit worse than expected but smallest deficit in three months Australia consumer confidence sees biggest drop in 17 months USD corrects from recent strength as markets might have gotten ahead of itself on the debate over tapering of QE UK retail sales come in negative and below expectations; cold weather blamed Economic Data (HU) Hungary Mar Avg Gross Wages Y/Y: 3.2% v 3.0%e (DK) Denmark May Consumer Confidence: -2.6 v -2.5e (EU) ECB: €206M borrowed in overnight loan facility vs. €190M prior; € ...





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