{"id":3016,"date":"2009-07-21T15:57:42","date_gmt":"2009-07-21T20:57:42","guid":{"rendered":"http:\/\/countingpips.com\/fx\/?p=3016"},"modified":"2009-07-21T15:57:42","modified_gmt":"2009-07-21T20:57:42","slug":"fundamental-outlook-at-1400-gmt-edt-0400-60","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/fx\/2009\/07\/21\/fundamental-outlook-at-1400-gmt-edt-0400-60\/","title":{"rendered":"Fundamental Outlook at 1400 GMT (EDT + 0400)"},"content":{"rendered":"

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

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

The euro moved lower vis-\u00e0-vis the U.S. dollar today as the single currency tested bids around the US$ 1.4250 level and was capped around the $1.4275 level.\u00a0\u00a0 A couple of factors led to a move higher for the dollar. First, there was talk that troubled U.S. commercial lender CIT may have insufficient liquidity, dousing yesterday\u2019s positive news that some bondholders may provide US$ 3 billion in emergency liquidity.\u00a0 The euro has been positively correlated with U.S. equity markets and an indication that a major financial company such as CIT could be in trouble is a setback for the euro.\u00a0 Second, U.S. assets reacted relatively positive to a Wall Street Journal commentary from Federal Reserve Governor Bernanke who outlined the steps the Fed may take to unwind its massive monetary stimuli and counter inflationary pressures after the economy begins to recover.\u00a0 Bernanke noted \u201cWe are confident we have the necessary tools to withdraw policy accommodation, when that becomes appropriate, in a smooth and timely manner.\u00a0 When the time comes to tighten monetary policy, we must either eliminate these large reserve balances or, if they remain, neutralize any potential undesired effects on the economy.\u201d Bernanke was careful to note a change in policy is not expected \u201cfor an extended period.\u201d\u00a0 Bernanke testified before Congress today and traders were left with the impression that the Fed will be responsive to any inflationary pressures that emerge as a result of the Fed\u2019s stimuli, a relief to U.S. dollar asset owners who do not want to see the value of their investments erode.\u00a0 Data released in the U.S. today saw the June Chicago Fed\u2019s National Activity Index print at -1.80, worse than expected but better than the previous print of -2.30.\u00a0 In eurozone news, European Central Bank member Draghi noted some \u201cpositive signs\u201d on the Italian economy.\u00a0 ECB member Nowotny noted the ECB has a \u201cclear\u201d exit strategy to implement when the time is right, but added \u201cnow\u2019s not the time.\u201d\u00a0 Nowotny added he sees no risk of deflation and said economic growth in 2010 will likely be too weak to avoid rising unemployment.\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 \u00a593.30 level and was capped around the \u00a594.40 level.\u00a0 The yen reclaimed some recent lost ground after it was reported that troubled U.S. commercial lending giant CIT Group may have insufficient liquidity to make upcoming bond payments.\u00a0 Minutes from Bank of Japan Policy Board\u2019s meeting of 15-16 July were released overnight in which policymaker indicated the central bank should consider ways to end its quantitative easing policies.\u00a0 Notably, the central bank earlier this month decided to extend some emergency financing programs through the end of the year and indicated they would seek to end the programs if the economy continues to improve.\u00a0 On the political front, Prime Minister Aso dissolved Parliament today and a general election is expected before 30 August.\u00a0 The Nikkei 225 climbed 2.73% to close at \u00a59,652.02.\u00a0 U.S. dollar offers are cited around the \u00a5104.15 level.\u00a0 The euro moved lower vis-\u00e0-vis the yen as the single currency tested bids around the \u00a5132.40 level and was capped around the \u00a5134.50 level.\u00a0 The British pound moved lower vis-\u00e0-vis the yen as sterling tested bids around the \u00a5153.10 level while the Swiss franc moved lower vis-\u00e0-vis the yen and tested bids around the \u00a587.35 level. In Chinese news, the U.S. dollar strengthened vis-\u00e0-vis the Chinese yuan as the greenback closed at CNY 6.8300 in the over-the-counter market, up from CNY 6.8298.<\/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 moved lower vis-\u00e0-vis the U.S. dollar today as the single currency tested bids around the US$ 1.4250 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-3016","post","type-post","status-publish","format-standard","hentry"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/posts\/3016","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=3016"}],"version-history":[{"count":0,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/posts\/3016\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/media?parent=3016"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/categories?post=3016"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/tags?post=3016"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}