{"id":2620,"date":"2009-06-23T15:29:35","date_gmt":"2009-06-23T20:29:35","guid":{"rendered":"http:\/\/countingpips.com\/fx\/?p=2620"},"modified":"2009-06-23T15:29:35","modified_gmt":"2009-06-23T20:29:35","slug":"fundamental-outlook-at-1400-gmt-edt-0400-52","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/fx\/2009\/06\/23\/fundamental-outlook-at-1400-gmt-edt-0400-52\/","title":{"rendered":"Fundamental Outlook at 1400 GMT (EDT + 0400)"},"content":{"rendered":"

By GCI Fx Research<\/span><\/p>\n

\u20ac
\n<\/strong>
\nThe euro rallied sharply vis-\u00e0-vis the U.S. dollar today as the single currency tested offers around the US$ 1.4105 level and was supported around the $1.3830 level.\u00a0 The common currency\u2019s climb was precipitated by increasing speculation the Federal Open Market Committee will try to manage expectations about a possible interest rate increase later this year.\u00a0 There is a growing market view the Fed\u2019s federal funds target rate will remain between 0% and 0.25% for the remainder of the year.\u00a0 Some traders believe the Fed will try to signal an eventual end to its quantitative easing policy while others believe the Fed will extend its US$ 300 billion U.S. Treasury purchases program.\u00a0 Fed funds futures are currently pricing in about a 42% chance the Fed will raise its fed funds target rate to 0.50% by December, down from a 49% chance one week ago.\u00a0 Data released in the U.S. today saw May existing home sales rise 2.4% to an annualized 4.77 million annual rate from 4.66 million in April.\u00a0 Other data saw the Richmond Fed\u2019s June manufacturing shipments index decline to +2 from +9 in May while the headline manufacturing index improved to +6 from +4 in May.\u00a0 In eurozone news, European Central Bank policymaker Weber reported policymakers have already reduced interest rates as much as possible, an indication the ECB is probably more hawkish than the Fed at this time.\u00a0 Weber also said policymakers would \u201chave to bypass the banking sector\u201d if it is unable to provide the real eurozone economy with ample credit.\u00a0 This suggests the ECB could extend its plan to purchase up to \u20ac60 billion in covered bonds to ease market interest rates.\u00a0 Weber also said the economic growth forecasts for 2011 are \u201crelatively modest.\u201d\u00a0 ECB member Nowotny added there is \u201cjustified hope that at least the financial markets have the worst behind them.\u201d Similarly, ECB policymaker Quaden said the eurozone\u2019s economy will be \u201cless bad\u201d for the rest of the year and then progressively improve in 2010.\u00a0 Additionally, ECB policymaker Noyer said the ECB \u201cmust stand ready to absorb excess liquidity as soon as necessary. Today, there is no need to start or even prepare for an imminent start.\u201d\u00a0 Noyer added \u201cMonetary policy must be eased without jeopardizing price stability.\u00a0 If we had a de-anchoring of inflation expectations, we would have durably slower growth or even economic stagnation.\u201d\u00a0 Data released in the eurozone today saw the June EMU-16 composite Purchasing Managers Index improve to 44.4 from 44.0 in May, below expectations.\u00a0 Moreover, the German July GfK consumer confidence index improved to 2.9 from 2.6 in June.\u00a0 Euro bids are cited around the US$ 1.3435 level.<\/p>\n

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

The yen appreciated vis-\u00e0-vis the U.S. dollar today as the greenback tested bids around the \u00a594.85 level and was capped around the \u00a595.95 level.\u00a0 Finance minister Yosano reported the government will maintain its pledge to reduce public works spending by 3%.\u00a0 Also, it was reported the Aso government wants budget ceiling guidelines next week and Aso\u2019s Cabinet approved the fiscal policy outline for next year.\u00a0 Most traders expect the Bank of Japan will keep the overnight call rate target unchanged at 0.10% for the foreseeable future.\u00a0 The Nikkei 225 stock index lost 2.82% to close at \u00a59,549.61.\u00a0 U.S. dollar offers are cited around the \u00a5104.15 level.\u00a0 The euro moved higher vis-\u00e0-vis the yen as the single currency tested offers around the \u00a5134.40 level and was supported the \u00a5131.40 level.\u00a0 The British pound moved higher vis-\u00e0-vis the yen as sterling tested offers around the \u00a5156.85 level while the Swiss franc moved higher vis-\u00e0-vis the yen and tested bids around the \u00a589.45 level. In Chinese news, the U.S. dollar came off vis-\u00e0-vis the Chinese yuan as the greenback closed at CNY 6.8338 in the over-the-counter market, down from CNY 6.8345.<\/p>\n

Daily Market Commentary<\/strong><\/em> provided by\u00a0GCI Financial Ltd<\/strong><\/a>.<\/strong><\/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","protected":false},"excerpt":{"rendered":"

By GCI Financial – The euro rallied sharply vis-\u00e0-vis the U.S. dollar today as the single currency tested offers around the US$ 1.4105 level…<\/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-2620","post","type-post","status-publish","format-standard","hentry"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/posts\/2620","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=2620"}],"version-history":[{"count":0,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/posts\/2620\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/media?parent=2620"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/categories?post=2620"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/tags?post=2620"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}