{"id":3801,"date":"2009-09-14T16:27:50","date_gmt":"2009-09-14T21:27:50","guid":{"rendered":"http:\/\/countingpips.com\/fx\/?p=3801"},"modified":"2009-09-14T16:27:50","modified_gmt":"2009-09-14T21:27:50","slug":"fundamental-outlook-at-1400-gmt-edt-0400-79","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/fx\/2009\/09\/14\/fundamental-outlook-at-1400-gmt-edt-0400-79\/","title":{"rendered":"Fundamental Outlook at 1400 GMT (EDT + 0400)"},"content":{"rendered":"

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

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

The euro extended recent gains vis-\u00e0-vis the U.S. dollar today as the single currency tested offers around the US$ 1.4650 level and was supported around the $1.4515 level.\u00a0 The common currency reached its highest level since 18 December 2008 as negative sentiment continued to surround the U.S. dollar.\u00a0 Data released in the eurozone today saw EMU-16 employment decline 702,000 in the second quarter, up from -1.2 million in the first quarter.\u00a0 Other data released today saw EMU-16 July industrial production decline 0.3% m\/m and 15.9% y\/y.\u00a0 Many economists believe the Federal Reserve will raise interest rates before the European Central Bank.\u00a0 Interest rate futures are currently indicating the ECB will hike rates later and more slowly than the Fed.\u00a0 Euribor interest rate futures are signaling the ECB will raise rates in Q4 2010 from their current 1.0% level.\u00a0 In contrast, fed funds futures are predicting a 60% chance the Fed will lift interest rates to 0.25% no later than Q2 2010.\u00a0 Most economists continue to predict the U.S. unemployment rate will top out north of 10% and that jobs may slowly be created next year.\u00a0 The U.S. dollar has become a carry trade vehicle as borrowing costs are at record lows and the current interest rate structure is favouring higher-yielding currencies including the euro, Australian dollar, and New Zealand dollar.\u00a0 The Obama administration is currently preparing a plan that would overhaul global financial institutions, an initiative the government will try to gain support for at the upcoming Group of Twenty summit in Pittsburgh.\u00a0 ECB Vice President Papademos reported he will remain at the ECB until the end of his term and ECB President Trichet said that if Lehman Brothers were rescued one year ago it would not have necessarily have prevented the financial crisis from worsening.\u00a0 ECB member Wellink said he expects the economic recovery to be \u201cvery slow.\u201d\u00a0 The European Union today maintained its 2009 eurozone inflation forecast at 0.4% and now sees gross domestic product growth off 4% this year.\u00a0 In U.S. news, San Francisco Fed President Yellen reported the Fed should boost employment and curb disinflation.\u00a0 Yellen also warned a major decline in the U.S. dollar could precipitate inflation and said unemployment will likely \u201cremain elevated\u201d for a few years.\u00a0 Euro bids are cited around the US$ 1.3900 figure.<\/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 \u00a591.15 level and was supported around the \u00a590.20 level.\u00a0 Bank of Japan\u2019s Policy Board convenes this week and is likely to keep interest rates unchanged.\u00a0 The central bank also likely will not decide at this meeting whether or not to let its liquidity support programs expire at the end of December.\u00a0 BoJ-watchers are curious to see if the central bank will mention the deflationary pressures that are evident in the economy.\u00a0 BoJ Governor Shirakawa will speak after the central bank\u2019s decision is announced on Thursday and could reiterate that deflationary pressures are likely for some time.\u00a0 Data released in Japan today saw the July revised industrial production up 2.1% m\/m, better than the preliminary +1.9% print.\u00a0 Ministry of finance official Tango reported the government is paying \u201cclose attention\u201d to the yen but did not hint at actual intervention.\u00a0 Notably, Japan\u2019s fiscal half year ends at the end of this month and some of the recent appreciation of the yen could represent companies repatriating their overseas assets.\u00a0 The Nikkei 225 stock index lost 2.32% to close at \u00a510,202.06.\u00a0 U.S. dollar offers are cited around the \u00a594.75 level.\u00a0 The euro moved higher vis-\u00e0-vis the yen as the single currency tested offers around the \u00a5132.90 level and was supported around the \u00a5131.30 level.\u00a0 The British pound moved lower vis-\u00e0-vis the yen as sterling tested bids around the \u00a5149.90 level while the Swiss franc moved higher vis-\u00e0-vis the yen and tested offers around the \u00a587.80 level. In Chinese news, the U.S. dollar gained ground vis-\u00e0-vis the Chinese yuan as the greenback closed at CNY 6.8224 in the over-the-counter market, up from CNY 6.8220.\u00a0 The Obama administration announced tariffs on Chinese tires and other goods while China announced it is launching an anti-dumping investigation into U.S. chicken and auto products.\u00a0 Most economists do not believe a trade war will ensue.<\/p>\n

Daily Market Commentary<\/strong><\/em> provided by<\/em><\/strong> GCI 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 extended recent gains vis-\u00e0-vis the U.S. dollar today as the single currency tested offers around…<\/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-3801","post","type-post","status-publish","format-standard","hentry"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/posts\/3801","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=3801"}],"version-history":[{"count":0,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/posts\/3801\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/media?parent=3801"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/categories?post=3801"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/tags?post=3801"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}