{"id":3091,"date":"2009-07-27T17:39:50","date_gmt":"2009-07-27T22:39:50","guid":{"rendered":"http:\/\/countingpips.com\/fx\/?p=3091"},"modified":"2009-07-27T17:39:50","modified_gmt":"2009-07-27T22:39:50","slug":"fundamental-outlook-at-1400-gmt-edt-0400-61","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/fx\/2009\/07\/27\/fundamental-outlook-at-1400-gmt-edt-0400-61\/","title":{"rendered":"Fundamental Outlook at 1400 GMT (EDT + 0400)"},"content":{"rendered":"

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

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

The euro appreciated vis-\u00e0-vis the U.S. dollar today as the single currency tested offers around the US$ 1.4295 level and was supported around the $1.4170 level.\u00a0 The common currency came within 40 pips of establishing a multi-month high before profit-taking ensued.\u00a0 Traders moved back into U.S. dollars during the North American session after it was reported the U.S. housing market improved further with the sales of new single-family homes climbing 11% in June to an annualized rate of 384,000 while June bulding permits were upwardly revised to +10% from +8.7%.\u00a0 Tere is a growing sense that the U.S. residential real estate market have bottomed out but in contrast, there is a significant amount of U.S. commercial real estate debt coming due over the next year and this may dramatically impact the economy.\u00a0 U.S. equity markets finished modestly on the plus side today with many dealers indicating stronger investor sentiment.\u00a0 Other data released in the U.S. today saw the Chicago Fed\u2019s Midwest manufacturing index decline 0.3% to 78.1, the lowest reading since 1993.\u00a0 In eurozone news, the European Central Bank reported its annual growth rate of private-sector loans in the eurozone receded to a record low of 1.5% in June from 1.8% in May.\u00a0 German research institute Ifo reported large banks have tightened their lending policies in Germany with big business suffering as a result.\u00a0 Other data saw the German August GfK consumer sentiment index improve to 3.5 from 3.0 in July while EMU-16 M3 money supply growth improved 3.5% y\/y in June.\u00a0 Additionally, it was reported German import prices were up 0.4% in June and off 11.4% y\/y.\u00a0 Euro bids are cited around the US$ 1.3435 level.<\/p>\n

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

The yen depreciated further vis-\u00e0-vis the U.S. dollar today as the greenback tested offers around the \u00a595.35 level and was supported around the \u00a594.65 level.\u00a0 The yen extended recent losses as the U.S. dollar traded near 2009 lows relative to major counterparts, reducing safety demand for U.S. dollars and encouraging Japanese investors to allocate capital to higher-yielding currencies.\u00a0 Another factor contributing to the yen\u2019s losses is the decline in currency volatility with implied volatility on options for the majors at around 13%, their lowest level since 26 September 2008.\u00a0 The lower volatility is creating demand for so-called carry trades in which yen are borrowed and then invested in higher-yielding opportunities overseas.\u00a0 The political drama in Japan remains quite active ahead of the General Election planned on or around 30 August. The opposition Democratic Party of Japan is expected to have a very strong showing at the polls, possibly defeating the Liberal Democratic Party of Japan.\u00a0 It remains unclear exactly how a DPJ victory could influence the yen but one possibility is further yen weakness on the premise the left-leaning DPJ may increase borrowing through Japanese government bonds. DPJ officials state they have no plans to shift Japan\u2019s foreign reserves at this time.\u00a0 Data released in Japan overnight saw the June corporate service price index decline 3.2% y\/y.\u00a0 The Nikkei 225 stock index climbed 0.59% to close at \u00a510,088.66.\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 \u00a5136.10 level and was supported around the \u00a5134.25 level.\u00a0 The British pound moved higher vis-\u00e0-vis the yen as sterling tested offers around the \u00a5157.45 level while the Swiss franc moved higher vis-\u00e0-vis the yen and tested offers around the \u00a589.30 level. In Chinese news, the U.S. dollar lost ground vis-\u00e0-vis the Chinese yuan as the greenback closed at CNY 6.8283 in the over-the-counter market, down from CNY 6.8284.\u00a0 The U.S. and China convened another meeting of the U.S.-China Strategic and Economic Dialogue today.\u00a0 Vice Premier Wang Qishan did not directly address the U.S. dollar and massive U.S. stimuli in public comments today but most China-watchers believe China will push the Obama administration to make sure its massive holdings of U.S. Treasury securities do not erode in value.\u00a0 Wang also reported China\u2019s gross domestic product expanded at a 7.1% rate in the first half of 2009, partially in response to the \u201ceffective\u201d US$ 585 billion stimulus China implemented.<\/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 appreciated vis-\u00e0-vis the U.S. dollar today as the single currency tested offers around the US$ 1.4295 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-3091","post","type-post","status-publish","format-standard","hentry"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/posts\/3091","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=3091"}],"version-history":[{"count":0,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/posts\/3091\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/media?parent=3091"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/categories?post=3091"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/tags?post=3091"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}