{"id":6570,"date":"2010-02-04T17:42:33","date_gmt":"2010-02-04T22:42:33","guid":{"rendered":"http:\/\/countingpips.com\/fx\/?p=6570"},"modified":"2010-02-04T17:42:33","modified_gmt":"2010-02-04T22:42:33","slug":"forex-daily-market-commentary-9","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/fx\/2010\/02\/04\/forex-daily-market-commentary-9\/","title":{"rendered":"Forex Daily Market Commentary"},"content":{"rendered":"

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

Fundamental Outlook at 1500 GMT (EDT + 0500)<\/strong><\/p>\n

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

The euro depreciated \t\tsharply vis-\u00e0-vis the U.S. dollar today<\/strong> as the \t\tsingle currency tested bids around the US$ 1.3725 level and was capped \t\taround the $1.3900 figure. \u00a0Several factors contributed to common \t\tcurrency\u2019s weakness and the dollar\u2019s strength.\u00a0 First, there is growing \t\tconcern that eurozone debt will continue to weaken.\u00a0 Credit default \t\tswaps in the so-called \u201cPIIGS\u201d countries \u2013 Portugal, Ireland, Italy, \t\tGreece, and Spain \u2013 blew out 15 \u2013 40 pips further today.\u00a0 Second, the \t\tEuropean Central Bank kept its benchmark interest rate at 1.0%, as \t\texpected.\u00a0 ECB President Trichet said the ECB is \u201cconfident the Greek \t\tgovernment will take all the decisions that will permit\u201d Greece to \t\treduce its budget deficit, including tax rises, public-sector wage \t\tfreezes, and pension reform.\u00a0 Third, dealers are nervous ahead of \t\ttomorrow\u2019s U.S. January non-farm payrolls report amid reports there will \t\tbe a sizable downward revision to previous calculations.\u00a0 Fourth, G7 \t\tofficials are convening in northern Canada from tomorrow and it is not \t\tknown if officials will address the ballooning deficits in many \t\tcountries or exchange rate misalignments.\u00a0 Fifth, New York State \t\tAttorney General Cuomo announced lawsuits against Bank of America and \t\tformer CEO Ken Lewis regarding its acquisition of Merrill Lynch.\u00a0 Sixth, \t\tthere have been some notable credit downgrades including one impacting \t\tWarren Buffett and warnings about the U.S.\u2019s credit outlook.\u00a0 Data \t\treleased in the eurozone today saw German factory orders decrease 0.2% \t\tm\/m and climb 8.4% y\/y.\u00a0 In U.S. news<\/strong>, data released today saw Q4 \t\tnon-farm productivity up 6.2%, down from a revised 7.2%, while Q4 unit \t\tlabour costs came off 4.4%, down from a revised -1.5%.\u00a0 Additionally, \t\tweekly initial jobless claims worsened to 480,000 from a revised 472,000 \t\tand continuing jobless claims increased to 4.602 million from a revised \t\t4.600 million.\u00a0 Also, December factory orders printed at 1.0%, unchanged \t\tfrom the revised November print.\u00a0 In addition to tomorrow\u2019s non-farm \t\tpayrolls data, December consumer credit data will be released.\u00a0 Euro \t\tbids are cited around the US$ 1.3530 level.<\/p>\n

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

The \t\tyen appreciated sharply vis-\u00e0-vis the U.S. dollar today<\/strong> as the greenback tested bids around the \u00a588.55 level and was capped \t\taround the \u00a591.05 level.\u00a0 The yen moved sharply higher across the board \t\tas traders shunned risk following a major sell-off in international \t\tequities markets, gold, crude oil, and other commodities.\u00a0 Bank of Japan \t\tGovernor Shirakawa will attend the Group of Seven meeting from tomorrow \t\tin northern Canada and will likely team up with finance minister Kan to \t\texpress Japan\u2019s dissatisfaction with China\u2019s yuan currency policy.\u00a0 BoJ \t\tPolicy Board member Nakamura today called on the government to improve \t\tthe country\u2019s fiscal health and said it would be \u201cdisastrous\u201d if \t\tinterest rates move higher on debt woes.\u00a0 Furthermore, Nakamura reported \t\tthe downward pressure on prices in Japan will continue.\u00a0 Data released \t\tin Japan yesterday saw January PMI services decline to 54.5 from 56.8 in \t\tDecember.\u00a0 The Nikkei 225 stock index lost 0.46% to close at \t\t\u00a510,355.98.\u00a0 U.S. dollar offers are cited around the \u00a594.75 level.\u00a0 The euro moved lower <\/strong>vis-\u00e0-vis the yen as the single currency tested \t\tbids around the \u00a5121.55 level and was capped around the \u00a5126.45 level.\u00a0 \t\tThe British pound moved lower <\/strong>vis-\u00e0-vis the yen as sterling \t\ttested bids around the \u00a5139.35 level while the Swiss franc moved \t\tlower <\/strong>vis-\u00e0-vis the yen and tested bids around the \u00a582.95 level. In Chinese news<\/strong>, the U.S. dollar appreciated vis-\u00e0-vis the Chinese \t\tyuan as the greenback closed at CNY 6.8268 in the over-the-counter \t\tmarket, up from CNY 6.8266. Beijing reacted coolly today to pressure \t\tfrom the Obama administration regarding its yuan currency, saying \u201cit is \t\tChina\u2019s own business.\u201d Li also said there \u201cwill not be any sudden or \t\tmajor yen appreciation.\u201d\u00a0 It was reported that new Chinese loans last \t\tmonth exceeded CNY 1.5 trillion.<\/p>\n

\u20a4<\/strong><\/p>\n

The British pound moved lower vis-\u00e0-vis the U.S. \t\tdollar today<\/strong> as cable tested bids around the \t\tUS$ 1.5730 level and was capped around the $1.5920 level. \u00a0As expected, \t\tBank of England\u2019s Monetary Policy Committee voted to keep its benchmark \t\tBank Rate unchanged at 0.50% and decided to pause its \u20a4200 billion asset \t\tpurchase program for the first time since March 2009.\u00a0 BoE kept the door \t\topen to enact more purchases if need be in the future.\u00a0 Dealers are \t\tincreasingly concerned about the growing level of U.K. deficits and \t\tdebt.\u00a0 Data released in the U.K. overnight saw Halifax house prices up \t\t0.6% m\/m and 3.6% y\/y.\u00a0 Cable bids are cited around the US$ 1.5720 \t\tlevel.\u00a0 The euro moved lower<\/strong> vis-\u00e0-vis the British pound as the \t\tsingle currency tested offers around the \u20a40.8710 level and was capped \t\taround the \u20a40.8755 level.<\/p>\n

Forex 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":"

As expected, Bank of England\u2019s Monetary Policy Committee voted to keep its benchmark Bank Rate unchanged at 0.50% and decided to pause its \u20a4200 billion asset purchase…<\/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-6570","post","type-post","status-publish","format-standard","hentry"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/posts\/6570","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=6570"}],"version-history":[{"count":0,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/posts\/6570\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/media?parent=6570"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/categories?post=6570"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/tags?post=6570"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}