InvestMacro Forex News

By TraderVox.com

Tradervox.com (Dublin) – Economic reports from the UK are pointing to a deepening recession in the country, pushing the ten-year gilts by five basis points last week. Speculations of deepening recession in the country have increased fears of monetary stimulus expansion. In a statement last week, the British Chambers of Commerce indicated that the Bank of England would expand its bond buying program this year. The Confederation of British Industry had indicated the same week that UK’s economy is likely to shrink for the first time since 2009 in 2012. UK gilts’ advance was also supported by Federal Reserve Bank Chairman, Ben Bernanke’s comments that he will not rule out quantitative easing measures it efforts to boost economic growth in the country.

Comments by the British Chambers of Commerce came at a time when the UK economy is deteriorating and, according to Nick Stamenkovic of RIA Capital Markets Ltd, the backdrop of economic picture remains poor despite some positive sentiments for gilts in the short term. Nick indicated that it is prudent for the BOE to keep the doors open for the expansion of the bond buying program. Speculations about expansion of bond buying program came after a report showed that consumer sentiment index remained at -29 points in August according to GfK NOP ltd. This was worse than the market expectation which was an increase to minus 27.

According to a BBC report, the Bank of England is expected to increase the bond buying kitty to 425 billion pounds this year from the current 375 billion. The report also indicated that the bank would hold this level up until 2014 when it would start to review the interest rates upwards. Another report by the British Retail Consortium showed that the UK retail sales dropped by 0.5 percent from July’s 0.1 percent gain. The final report will be released on September 4 and the bank of England will announce its monetary policy decision two days later where it is expected to keep the interest rates unchanged.

Disclaimer
Tradervox.com is not giving advice nor is qualified or licensed to provide financial advice. You must seek guidance from your personal advisors before acting on this information. While we try to ensure that all of the information provided on this website is kept up-to-date and accurate we accept no responsibility for any use made of the information provided. Opinions expressed at Tradervox.com are those of the individual authors and do not necessarily represent the opinion of Tradervox.com or its management. 

Article provided by TraderVox.com
Tradervox.com is a Forex News Portal that provides real-time news and analysis relating to the Currency Markets.
News and analysis are produced throughout the day by our in-house staff.
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The Aussie has acquired some notoriety over the years the as the world’s leading commodity currency.  Australia as a nation is digging up its minerals and shipping them to China and in return enjoying wealth and prosperity.  Since Australia has become so dependent on China buying these hard assets for its GDP, should Chinese demand slow down Australia would suffer a significant economic loss. 

In the short term the Aussie has been correcting its gain against the US Dollar from the $1.06 area.  The Aussie has been as high as $1.10 in recent history and has served as a point of resistance since first touching this rarified air in April 2011.   In the daily chart below we can see how the TSI began consolidating while price moved higher from June 20th to August 10th and then ultimately rolled over with the price selloff.  The Aussie is now seeking a short term bounce and the Fibonacci levels may help us identify where that bounce will come.  No sign yet but having only reached 38.2% there are still multiple levels ahead of us.

In the big picture on the weekly chart I wonder if perhaps this long bull run for the Aussie is coming to an end since the TSI is now below its long term moving average.  If the sell off continues and price makes its way through the .9400 area we can surmise that the bull market for the Aussie is over and a bear one has replaced it.  See the charts.

London Gold Market Report
from Ben Traynor
BullionVault
Tuesday 4 September 2012, 06:45 EDT

WHOLESALE prices to buy gold bullion hovered above $1690 an ounce Tuesday morning in London, in line with where they started the week, while stocks and commodities were broadly flat and US Treasuries fell, as markets looked ahead to this week’s European Central Bank policy meeting.

Silver bullion rose as high as $32.33 per ounce – 1.9% up on the week so far, and the highest level since April.

“Precious metals are continuing their upswing,” says Tuesday’s commodities note from Commerzbank.

“Silver has made even stronger gains than gold…underpinned by speculative financial investors.”
On the Shanghai Futures Exchange, the most actively traded silver contract hit a record high of 6932 Yuan per kilogram, newswire Reuters reports. The SFE launched its silver contract in May of this year.

In India meantime, which reclaimed its traditional place as the world’s biggest gold bullion buying nation in the second quarter, Rupee gold prices hit a fresh all-time high of Rs 31850 per 10 grams, according to local reports.

Euro gold bullion prices remained within 2.5% of their all-time high se  hit last September, while on the currency markets, the Euro climbed back above $1.26 in Tuesday’s Asian session, after ECB chief Mario Draghi reportedly said he would be comfortable with his institution buying government bonds of up to three years in maturity.

“[Draghi] considers that buying medium-term bonds of three years on the secondary markets is not money creation,” said French MEP Jean-Paul Gauzès, who sits on the Economic and Monetary Affairs Committee, before which Draghi appeared yesterday.

“Since in effect those debts will be due very quickly and the funds will be put back into the circuit…he said for example three years is OK, 15 years no.”

The ECB is due to make its latest policy announcement this Thursday, followed by a press conference with Draghi.

“We have to be very careful that we don’t raise false expectations,” warned German finance minister Wolfgang Schaeuble, speaking to Deutschlandfunk radio yesterday.

“It has to remain very clear, state debt can’t be financed through monetary policy. Therefore we can’t have a decision…that’s not covered by the ECB mandate.”

Small businesses in Spain meantime are facing the highest borrowing costs in four years – while those in Germany are paying record low interest rates – the Financial Times reports, citing ECB data published Monday.

“The fragmentation [of the Eurozone] is getting worse,” says David Riley, head of sovereign ratings at ratings agency Fitch.

“If this trend gains even greater momentum we’ll face a fundamental reordering of the Eurozone. It undercuts the whole rationale of the Euro, and could eventually make it easier for it to break up.”

“In such a difficult phase these [struggling] countries deserve our solidarity and that we root for them to overcome their difficulties,” German chancellor Angela Merkel told a crowd of beer drinkers in a tent near Munich yesterday.

“[But] we have [also] to press for reforms in other countries even if they sometimes say we’re hardline…it’s not enough just to keep muddling through.”

Only a quarter of Germans however think Greece should remain in the Euro, according to poll results published by the FT earlier this week. Bank of America Merrill Lynch has explored the option of filling trucks with cash and driving them to Greece to help clients keep their businesses running in the event of a Greek Euro exit, while Ford has configured its computer systems to accept a new Greek currency, according to the New York Times.

Rating agency Moody’s meantime has changed its outlook for the European Union’s Aaa credit rating from ‘stable’ to ‘negative’.

“The negative outlook on the EU’s long-term ratings reflects the negative outlook on the Aaa ratings of the member states with large contributions to the EU budget,” said a statement from Moody’s, adding that Germany, France, the UK and the Netherlands account for 45% of EU budget revenue.

“Moody’s believes that it is reasonable to assume the same probability of default by the EU on its debt obligations as the highest rated key members states’ probability of default.”

In July, Moody’s put Germany and the Netherlands on negative outlook.

In South Africa, four people were injured after police and security guards fired tear gas and rubber bullets at sacked gold mining workers who were trying to prevent colleagues from working at Gold One’s Modder East mine, Reuters reports.

In the separate dispute at the Gold Fields KDC East mine, this afternoon will see a mass meeting aimed at getting 12,000 people back to work.

Thirty-four striking platinum workers were shot dead last month during a dispute at Lonmin’s Marikana platinum mine.

Ben Traynor
BullionVault

Gold value calculator   |   Buy gold online at live prices

Editor of Gold News, the analysis and investment research site from world-leading gold ownership service BullionVault, Ben Traynor was formerly editor of the Fleet Street Letter, the UK’s longest-running investment letter. A Cambridge economics graduate, he is a professional writer and editor with a specialist interest in monetary economics. Ben writes and presents BullionVault’s weekly gold market summary on YouTube and can be found on Google+

(c) BullionVault 2012

Please Note: This article is to inform your thinking, not lead it. Only you can decide the best place for your money, and any decision you make will put your money at risk. Information or data included here may have already been overtaken by events – and must be verified elsewhere – should you choose to act on it.

By TraderVox.com

Tradervox.com (Dublin) – The Federal Reserve Chairman Ben Bernanke defended his monetary easing program in Jackson Hole Wyoming, where he indicated that he would be deploying such action to curb the rising unemployment in the country. In his speech, Bernanke described his actions as beneficial to the country’s economy and ensured that critics of such moves understood that he is aware of the disadvantages of such moves which he said were manageable. The remarks by the Fed Chairman led to an increase in stocks and treasuries as the dollar dropped to almost three-month low.

According to Mark Spindel of Potomac River Capital in Washington, the major point in Bernanke’s speech was that tools available will work and the status of the economy at the moment warrants serious consideration of these tools. After the speech, the Standard and Poor’s 500 Index appreciated by 0.5 percent as the ten-year Treasury note dropped by 0.07 percent. In addition the Dollar Index, used by the International Exchange Inc dropped by 0.55 percent to its lowest level since may 14. Bernanke also highlighted the disadvantages of high unemployment levels in the country, saying that they may cause irreversible damage to the US economy in the long term.

With these remarks, Former Fed Vice Chairman Alan Blinder interpreted Bernanke’s as a signal of stimulus as soon as September. Blinder said in Jackson Hole on Friday that given the fact that Bernanke used a similar forum to signal the second round of quantitative easing, his comments in Jackson Hole indicated that the Fed is likely to make the third round of purchases which might happen as soon as this month. According to Roberto Perli, a managing director responsible for policy research at International Strategy and Investment, indicated that the Fed is very close to making monetary easing and the only question remaining is whether it would happen this month or the fed would wait for a stronger case to be made. The Federal Open Market Committee meets on Sept 12-13 where they are expected to provide a way forward.

Disclaimer
Tradervox.com is not giving advice nor is qualified or licensed to provide financial advice. You must seek guidance from your personal advisors before acting on this information. While we try to ensure that all of the information provided on this website is kept up-to-date and accurate we accept no responsibility for any use made of the information provided. Opinions expressed at Tradervox.com are those of the individual authors and do not necessarily represent the opinion of Tradervox.com or its management. 

Article provided by TraderVox.com
Tradervox.com is a Forex News Portal that provides real-time news and analysis relating to the Currency Markets.
News and analysis are produced throughout the day by our in-house staff.
Follow us on twitter: www.twitter.com/tradervox

By TraderVox.com

Tradervox.com (Dublin) – Japanese companies’ capital spending gained by 6.6 percent according to a Finance Ministry report released on Monday in Tokyo. The increase fell short of market expectation which expected an increase of 7.8 percent. This is a big gain as a year earlier the figure fell by 8.2 percent. The report has sparked speculation that the Bank of Japan may embark on a bond purchases program to boost economy. Further, economists are expecting the government to revise its forecast that the economy grew by 1.4 percent in second quarter.  Japan’s economic woes are compounded by the declining consumer prices and the low industrial output registered in July. Economists have suggested that Japanese economy will shrivel due to the growing crisis in Europe and the strong yen in the forex market, which has reduced the countries exports.

Yoshimasa Maruyama, a Chief Economist in Tokyo at Itochu Corp, noted that the report showed capital spending figures that were lower than business spending figure in preliminary gross domestic product report. He concluded that this is an indication that companies in Japan have lowered their business spending and predicted that this trend might continue in the coming months. According to a RBS Security Japan Ltd report, the Bank of Japan may decide to expand its asset purchases program when the officials meet on September 18-19.

The Capital Spending report showed that company sales declined by 2.5 percent in April-through-June from the previous three months. The report also showed a decline in company spending by 0.5 percent in the same period. Junko Nishioka, a Chief Economist in Tokyo at RBS Securities Japan Ltd, noted that the major disappointing in the report was the decline in sales which was the first one in four quarters. The decline is an indication of declining production and exports in the country. Nishioka said that while Japan may not go into recession, the global slowdown has weakened the economy and the figures might force the government to revise its GDP forecasts downwards.

Disclaimer
Tradervox.com is not giving advice nor is qualified or licensed to provide financial advice. You must seek guidance from your personal advisors before acting on this information. While we try to ensure that all of the information provided on this website is kept up-to-date and accurate we accept no responsibility for any use made of the information provided. Opinions expressed at Tradervox.com are those of the individual authors and do not necessarily represent the opinion of Tradervox.com or its management. 

Article provided by TraderVox.com
Tradervox.com is a Forex News Portal that provides real-time news and analysis relating to the Currency Markets.
News and analysis are produced throughout the day by our in-house staff.
Follow us on twitter: www.twitter.com/tradervox

Article by AlgosysFx Forex Trading Solutions

The Euro continued its incline versus the Great British pound in the previous European trading exchanges as markets remain hopeful that the European Central Bank would take the necessary action to tackle the debt crisis at its policy meeting this coming September 6. As traders still hold on to hopes of an ECB intervention in the bond markets, the single currency is expected to rise versus the Pound in today’s European exchanges.

As the central bank policy makers near their key meeting this week to announce measures to defend the shared currency, so are the European officials in the persons of the four most powerful leaders in the Euro Zone. German Chancellor Angela Merkel, French President Francois Hollande, Italian Prime Minister Mario Monti and Spanish Prime Minister Mariano Rajoy are having their own meetings, and all have seemingly shown support for a more active participation of the central bank in the fight against the debt crisis; although talks have not gone smoothly as others anticipated because of the leaders’ contrasting opinions. But others remain positive that the European officials are brewing an agreement to effectively deal with the debt crisis.

Even though the European Union’s outlook was cut by Moody’s Investors Service, the shared currency is expected to find support from expectations that the ECB would resume its bond buying. According to Jean-Paul Gauzes, member of the European Parliament, ECB President Mario Draghi said that he would be comfortable buying debt with maturities of up to about three years, as reported in Bloomberg News. On speculations that Draghi’s plan would work in order that confidence would be supplied to the beleaguered Euro area, the EURGBP is likely to go higher. Thus, a long position is recommended in today’s European trading session.

For more news, analysis, technical charts and candlestick analysis, visit AlgosysFx

By TraderVox.com

Tradervox.com (Dublin) – Economist are projecting that the US payrolls may have grown at a slower pace in August and unemployment is likely to remain above eight percent according to a report to be released by the Labor Department on September 7. Most analysts have indicated that the slowing labor market may have prompted the Federal Reserve Chairman Ben S. Bernanke to highlight this sector as of grave concern to US policy makers when he spoke in Jackson Hole last Friday. The market is expecting 125,000 jobs to have been created in August against a job growth of 163k in July. Joblessness is expected to remain at 8.3 percent. The US economy is seen to be faltering as a separate report is set to indicate that US manufacturing was swinging between expanding and shrinking.

According to Joshua Shapiro, the Chief Economist in New York at Maria Fiorini Ramirez Inc, the slowing payrolls are only going to make it hard to bring unemployment down. He indicated that the labor demand is soggy and the US is experiencing some weaknesses in exports. In addition, the growing fiscal uncertainty will add to slow growth in Labor market. In his speech last week, the Fed Chairman Ben Bernanke indicated that the stagnation in labor market has led the policy makers to keep the monetary stimulus option on the table. He pointed out that the lower-than-expected gains in employment and consumer spending has been compounded by the global economic slowdown and growing concerns over the “US Fiscal cliff.” These factors are making it difficult for the economy to rebound and even more daunting for the labor market.

The task of boosting the job market has been exacerbated by the recent announcements from major US companies which have indicated that they would be cutting jobs to reduce their operational cost. Google Inc, on August 13, said that it would cut 4,000 employees while Lexmark International Inc, a Kentucky-based printer maker indicated that it would reduce its workforce by 1,700 globally as it projected to close one of its companies  in Philippines. These scenarios have pushed the FOMC to consider monetary stimulus as a major boost to this sector.

Disclaimer
Tradervox.com is not giving advice nor is qualified or licensed to provide financial advice. You must seek guidance from your personal advisors before acting on this information. While we try to ensure that all of the information provided on this website is kept up-to-date and accurate we accept no responsibility for any use made of the information provided. Opinions expressed at Tradervox.com are those of the individual authors and do not necessarily represent the opinion of Tradervox.com or its management. 

Article provided by TraderVox.com
Tradervox.com is a Forex News Portal that provides real-time news and analysis relating to the Currency Markets.
News and analysis are produced throughout the day by our in-house staff.
Follow us on twitter: www.twitter.com/tradervox

Source: ForexYard

The euro was able to largely maintain its recent gains yesterday, as a lack of significant news resulted in a low liquidity environment in the marketplace. That being said, the Australian dollar fell to new six-week lows against both the USD and JPY following the release of disappointing Chinese and Australian economic indicators. Today, traders will want to pay attention to the US ISM Manufacturing PMI, set to be released at 14:00 GMT. While the US Non-Farm Employment Change, set to be released on Friday, is forecasted to be the highlight of the trading week, a better than expected manufacturing figure today could help the dollar recoup some of its recent losses.

Economic News

USD – US Manufacturing Data Could Help USD

A lack of US news due to a bank holiday yesterday resulted in the US dollar seeing very little movement against its main currency rivals over the course of the day. After dropping to a three-week low against the Japanese yen on Friday, the dollar was able to see a slight upward correction during the Asian session yesterday. The USD/JPY advanced 18 pips to trade as high as 78.39 before reversing to stabilize at the 78.30 level. The greenback also advanced close to 15 pips against the Swiss franc to reach as high as 0.9558 during European trading.

Today, the dollar is likely to see more volatility when the US ISM Manufacturing PMI is released at 14:00 GMT. Analysts are predicting that today’s news will come in at 50.1, which if true, would not only signal an improvement from last month, but would also be a sign that the US manufacturing sector is expanding. The dollar could see bullish movement during afternoon trading if the PMI comes in at or above expectations. Additionally, traders will also want to remember that the all-important US Non-Farm Payrolls figure is being released on Friday, and is likely to result in significant activity in the marketplace.

EUR – Euro Remains Bullish Ahead of Possible ECB Action

After hitting a two-month high against the US dollar on Friday, the euro was able to largely maintain its recent gains yesterday, despite the absence of significant economic news. The EUR/USD spent much of the day trading around the 1.2570 level, virtually unchanged from when markets opened for the week, and not far below Friday’s high of 1.2636. Against the British pound, the euro took moderate losses over the course of the day, falling around 15 pips before stabilizing at the 0.7915 level.

Turning to today, euro traders will want to pay attention to US manufacturing data, as it could result in volatility for the euro. If the US data comes in below the expected level, speculations that the Fed may initiate a new round of quantitative easing in the near future may increase, which could lead to significant gains for the euro. Later in the week, traders should not forget to pay attention to an ECB press conference, scheduled to take place on Thursday. Some analysts are predicting that the ECB could unveil steps to lower borrowing costs in the euro-zone, which if true, could help the common currency extend its gains.

Gold – Gold Stays Close to 5-Month High

Hopes among investors that the Fed and ECB will both take steps in the near future to boost the economic recoveries in the US and euro-zone, kept the price of gold near a five-month high during European trading yesterday. The precious metal gained more than $4 an ounce during the mid-day session to trade as high as $1692.03.

Turning to today, gold may reverse some of its upward momentum if a US manufacturing indicator comes in above its forecasted level and leads to bullish movement for the USD. In such a case, the precious metal would become more expensive for international buyers which could result in a downward correction.

Crude Oil – Despite Poor Chinese Data, Oil Maintains Gains

After taking moderate losses during Asian trading following the release of disappointing Chinese data, crude oil was able to stage a recovery during the European session. Crude fell around $0.50 to reach as low as $95.99 a barrel soon after markets opened for the week. The commodity was able to gain back virtually all of its losses and was trading at $96.46 by the afternoon session.

Today, oil traders will want to pay attention to monitoring developments in the euro-zone and US. Any signs that either the ECB or Fed are getting ready to take steps to help boost their respective economies, as is widely expected, could lead to risk taking which would lead to additional gains for oil.

Technical News

EUR/USD

The Bollinger Bands on the weekly chart are beginning to narrow, signaling a possible price shift in the coming days. Furthermore, the Williams Percent Range on the same chart is approaching the overbought zone, indicating that the price shift could be downward. Opening short positions may be the wise choice for this pair.

GBP/USD

Most technical indicators on the daily and weekly charts show this pair range trading, making it difficult to make a long-term prediction. Traders may want to take a wait and see approach, as a clearer trend is likely to present itself in the near future.

USD/JPY

The daily chart’s Slow Stochastic appears close to forming a bearish cross, indicating that an upward correction could occur in the near future. Furthermore, the Williams Percent Range on the weekly chart has dropped into oversold territory. Opening long positions may be the right move for this pair.

USD/CHF

Long-term technical indicators are providing mixed signals for this pair. On the one hand, the MACD/OsMA on the weekly chart has formed a bearish cross, meaning that downward movement could occur. On the other hand, the same chart’s Williams Percent Range has fallen into oversold territory. Taking a wait and see approach may be the best choice for this pair.

The Wild Card

NZD/JPY

The daily chart’s Relative Strength Index has dropped into oversold territory, signaling that an upward correction could occur in the near future. Furthermore, the Slow Stochastic on the same chart has formed a bullish cross. Forex traders may want to open long positions ahead of an upward breach.

Forex Market Analysis provided by ForexYard.

© 2006 by FxYard Ltd

Disclaimer: Trading Foreign Exchange carries a high level of risk and may not be suitable for all investors. There is a possibility that you could sustain a loss of all of your investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with Foreign Exchange trading.

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Source: ForexYard

The euro was able to come within reach of a two-month high against the US dollar during overnight trading, as hopes that the ECB will unveil plans to lower borrowing costs in the euro-zone led to risk taking in the marketplace. The EUR/USD advanced more than 45 pips to reach as high as 1.2626 before staging a slight downward correction. The pair is currently trading at the 1.2615 level. Commodities and precious metals saw little movement last night. The price of crude oil remained around its current level of $97.15, a one-week high. Gold spent most of the night trading at the $1695 level, a five-month high.

Main News for Today

US ISM Manufacturing PMI- 14:00 GMT
• The PMI is forecasted to come in at 50.0, which if true, would indicate expansion in the US manufacturing sector
• If today’s news comes in at or above the forecasted level, the USD could recoup some of its recent losses against the EUR and JPY

Read more forex news on our forex blog

Forex Market Analysis provided by ForexYard.

© 2006 by FxYard Ltd

Disclaimer: Trading Foreign Exchange carries a high level of risk and may not be suitable for all investors. There is a possibility that you could sustain a loss of all of your investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with Foreign Exchange trading.