{"id":11488,"date":"2010-07-27T17:16:40","date_gmt":"2010-07-27T21:16:40","guid":{"rendered":"http:\/\/countingpips.com\/fx\/?p=11488"},"modified":"2010-07-27T17:16:40","modified_gmt":"2010-07-27T21:16:40","slug":"forex-daily-market-commentary-88","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/fx\/2010\/07\/27\/forex-daily-market-commentary-88\/","title":{"rendered":"Forex Daily Market Commentary"},"content":{"rendered":"

By GCI Forex Research<\/strong><\/p>\n

Fundamental Outlook at 1400 GMT (EDT + 0400)<\/strong><\/p>\n

\u20ac<\/strong><\/p>\n

The euro depreciated vis-\u00e0-vis the U.S. dollar today as the single currency tested bids around the US$ 1.2950 level and was capped around the $1.3045 level.\u00a0 The common currency continues to orbit the psychologically-important US$ 1.3000 figure as traders weigh an improving eurozone sovereign outlook against a deceleration in U.S. economic activity.\u00a0 Dealers reacted to last Friday\u2019s eurozone bank stress tests results by pushing the euro back above the US$ 1.3000 figure on the perception the European banking system should be able to withstand additional dislocations in the sovereign credit market.\u00a0 European Central Bank officials talked up the stress tests late last week and yesterday, suggesting the eurozone received more than a passing grade.\u00a0 Data released in the eurozone today saw the June M3 money supply increase 0.2% y\/y and the ECB\u2019s bank lending survey will be released tomorrow.\u00a0 German data saw the August GfK consumer confidence survey climb significantly to 3.9 from the prior reading of 3.6 and the June import price index was up 0.9% m\/m and 9.1% y\/y.\u00a0 Provisional July CPI data will be released tomorrow.\u00a0 French data saw total June jobseekers off 8,600, an indication of an improving labour market there.\u00a0 In U.S. news, dealers reacted negatively to a lower-than-expected July consumer confidence print of 50.4, compared with the previous revised total of 54.3.\u00a0 These data suggest consumer spending may be relatively weak as final private demand is limited by current sentiment.\u00a0 Other data saw the July Richmond Fed manufacturing index decline to +16 from the prior print of +23 while the May S&P\/CaseShiller home price index was up 0.47% m\/m and 4.61% y\/y.\u00a0 MBA mortgage applications, June durable goods orders, and the Fed\u2019s Beige Book will be released tomorrow.\u00a0 Philadelphia Fed President Plosser yesterday suggested the current economic situation does not warrant additional Fed stimulus but added the FOMC is prepared to move if and when needed.\u00a0 Euro offers are cited around the US$ 1.3265 level.<\/p>\n

\u00a5\/ CNY<\/strong><\/p>\n

The yen depreciated vis-\u00e0-vis the U.S. dollar today as the greenback tested offers around the \u00a587.90 level and was supported around the \u00a586.80 level.\u00a0 Dealers pushed the yen lower today on expectations Bank of Japan could ease monetary policy further.\u00a0 Demand for Japanese government bonds remains strong and this is a signal that many investors expect Japanese yields could fall further.\u00a0 There is still talk the government may look to protect the psychologically-important \u00a585 handle by selling yen for U.S. dollars or other currencies in what would be the country\u2019s first official yen-selling intervention in several years.\u00a0 Many BoJ-watchers believe the central bank will maintain its ultra-accommodative monetary policy for at least two more years.\u00a0 Japanese banks have been investing in longer-dated debt and the swaps market to record profits as yields on five-year JGBs move lower.\u00a0 Data released in Japan overnight saw the June corporate service price index decline 1.0% y\/y, lower than the previous -0.8% May result and the latest evidence that deflation remains a major problem for the Japanese economy.\u00a0 The Nikkei 225 stock index lost 0.07% to close at \u00a59,496.85.\u00a0 U.S. dollar bids are cited around the \u00a586.29 level.\u00a0\u00a0 The euro moved higher vis-\u00e0-vis the yen as the single currency tested offers around the \u00a5114.10 level and was supported around the \u00a5112.75 level.\u00a0 The British pound moved higher vis-\u00e0-vis the yen as sterling tested offers around the \u00a5136.65 level while the Swiss franc moved lower vis-\u00e0-vis the yen and tested bids around the \u00a582.30 level. In Chinese news, the U.S. dollar depreciated vis-\u00e0-vis the Chinese yuan as the greenback closed at CNY 6.7784 in the over-the-counter market, down from CNY 6.7790.\u00a0 Data released in China overnight saw the June leading index decline to 102.84 from the revised prior tally of 103.25.\u00a0 People\u2019s Bank of China reported China\u2019s economic fundamentals remain \u201cgood\u201d and said the recent deceleration in economic growth will likely stabilize.<\/p>\n

\u00a3
\n<\/strong><\/p>\n

The British pound appreciated vis-\u00e0-vis the U.S. dollar today as cable tested offers around the US$ 1.5575 level and was supported around the US$ 1.5440 level.\u00a0 Cable reached its strongest level since February 2010 as traders reacted positively to a surprise +33 print in July CBI reported sales, up from the prior reading of -5.\u00a0 Additionally, none of the \u00a3355 million in corporate bond securities Bank of England said it would purchase in its twice-weekly program was tendered today, the first time investors did not seek a BoE bid since March.\u00a0 This is indicative of improving sentiment in the credit markets.\u00a0 A perceived relaxation of terms in the Basel 3 capital accord terms is also supporting sterling.\u00a0\u00a0 The key functions of the Financial Services Authority will be relegated to the BoE. Cable bids are cited around the US$ 1.5270 level.\u00a0 The euro depreciated vis-\u00e0-vis the British pound as the single currency tested bids around the \u00a30.8345 level and was capped around the \u00a30.8415 level.<\/p>\n

CHF<\/strong><\/p>\n

The Swiss franc depreciated vis-\u00e0-vis the U.S. dollar today as the greenback tested offers around the CHF 1.0635 level and was supported around the CHF 1.0480 level.\u00a0 Data released in Switzerland today saw the June UBS consumption indicator improve to 1.810, up from the revised May result of 1.712 and its highest level since July 2008. Swiss unemployment remains at about half the level as the eurozone\u2019s rate and this is resulting in positive economic activity.\u00a0 There is some speculation Swiss National Bank may have intervened by selling francs today given the significant move lower for the currency but SNB would not confirm this speculation.\u00a0 U.S. dollar offers are cited around the CHF 1.0980 level.\u00a0 The euro appreciated vis-\u00e0-vis the Swiss franc as the single currency tested offers around the CHF 1.3795 level while the British pound moved higher vis-\u00e0-vis the Swiss franc and tested offers around the CHF 1.6525 level.<\/p>\n

Forex Daily Market Commentary<\/strong><\/em> provided by<\/em><\/strong> GCI Financial Ltd<\/strong><\/a>.<\/strong><\/span><\/p>\n

GCI Financial Ltd (\u201dGCI\u201d) is a regulated securities and commodities trading firm, specializing in online Foreign Exchange (\u201dForex\u201d) brokerage. GCI executes billions of dollars per month in foreign exchange transactions alone. In addition to Forex, GCI is a primary market maker in Contracts for Difference (\u201dCFDs\u201d) on shares, indices and futures, and offers one of the fastest growing online CFD trading services. GCI has over 10,000 clients worldwide, including individual traders, institutions, and money managers. GCI provides an advanced, secure, and comprehensive online trading system. Client funds are insured and held in a separate customer account. In addition, GCI Financial Ltd maintains Net Capital in excess of minimum regulatory requirements.<\/p>\n

DISCLAIMER: GCI\u2019s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be U.S.ed as investment advice. GCI assumes no responsibility or liability from gains or losses incurred by the information herein contained.<\/p>\n


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Japanese banks have been investing in longer-dated debt and the swaps market to record profits as yields on five-year JGBs move lower. Data released in Japan overnight saw the June…<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-11488","post","type-post","status-publish","format-standard","hentry"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/posts\/11488","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/comments?post=11488"}],"version-history":[{"count":0,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/posts\/11488\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/media?parent=11488"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/categories?post=11488"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/tags?post=11488"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}