{"id":7705,"date":"2010-03-18T18:20:45","date_gmt":"2010-03-18T22:20:45","guid":{"rendered":"http:\/\/countingpips.com\/fx\/?p=7705"},"modified":"2010-03-18T18:20:45","modified_gmt":"2010-03-18T22:20:45","slug":"forex-daily-market-commentary-29","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/fx\/2010\/03\/18\/forex-daily-market-commentary-29\/","title":{"rendered":"Forex Daily Market Commentary"},"content":{"rendered":"

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

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

The euro depreciated vis-\u00e0-vis the U.S. \t\tdollar today<\/strong> as the single currency tested bids around the US$ \t\t1.3585 level and was capped around the $1.3740 level. \u00a0The common \t\tcurrency came off significantly amid rumours the Federal Reserve planned \t\tan intermeeting increase in the discount rate later today.\u00a0 While a move \t\tin the discount rate would probably not have a major impact on market \t\tliquidity \u2013 such a move would be largely symbolic \u2013 it would be the \t\tlatest indication that policymakers are looking to normalize policy as \t\tmuch as possible without lifting the federal funds target rate. \u00a0The \t\tFed\u2019s balance sheet increase US$ 25.5 billion last week to US$ 2.31 \t\ttrillion.\u00a0 Also weighing heavily on the common currency was a report \t\tthat Greek Prime Minister Papandreou called on the European Union to \t\tindicate how much and what type of financial assistance would be \t\tavailable if Greek requires help in addressing its mammoth fiscal \t\timbalances.\u00a0 Germany apparently backtracked on the issue and instead of \t\tsuggesting aid some could from a European Union partner or bilateral \t\tcredit facility, Berlin is said to now support assistance from the \t\tInternational Monetary Fund.\u00a0 Some believe the IMF may not be able to \t\tprovide enough financial assistance to Greece.\u00a0 European Union officials \t\tare planning to convene at a summit next week and this topic will be \t\tprominent.\u00a0 Earlier in the week, the European Union signaled it was \t\tready to provide financial assistance to Greece if required.\u00a0 Data \t\treleased in the eurozone today saw the EMU-16 January current account \t\tbalance print at -\u20ac8.1 billion compared with the revised prior reading \t\tof +\u20ac 2.3 billion.\u00a0 Also, the eurozone trade balance worsened to -\u20ac8.9 \t\tbillion from the revised reading of +\u20ac 4.4 billion.\u00a0 In U.S. news<\/strong>, \t\tthe February consumer price index was up 0.0% m\/m and 2.1% y\/y while the \t\tex-food and energy core rate was up 0.1% y\/y and 1.3% y\/y.\u00a0 \t\tAdditionally, weekly initial jobless claims fell 5,000 to 457,000 while \t\tcontinuing jobless claims grew to 4.579 million.\u00a0 The Q4 current account \t\tdeficit worsened to \u2013US$ 115.6 billion, the Philadelphia Fed March index \t\trallied, and February leading indicators fell back to +0.1%.\u00a0 Overall, \t\tU.S. economic data continue to be mixed-to-better but there does not \t\tappear to be any traction evident in the U.S. labour market yet.\u00a0 \t\tFederal Reserve Chairman Bernanke criticized the so-called Dodd plan for \t\tregulatory oversight that seeks to limit the Fed\u2019s regulatory and \t\tsupervisory powers.\u00a0 Euro bids are cited around the US$ 1.3335 level.<\/p>\n

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

The yen appreciated \t\tvis-\u00e0-vis the U.S. dollar today<\/strong> as the greenback tested bids around \t\tthe \u00a589.75 level and was capped around the \u00a590.80 level. \u00a0Bank of Japan \t\tkept its economic assessment unchanged for a fourth consecutive month, \t\treporting the economy is \u201cpicking up.\u201d The central bank also upped its \t\tassessment of business investment, adding it is \u201cleveling out on the \t\twhole.\u201d\u00a0 Reuters released its quarterly corporate sentiment survey ahead \t\tof the release of next month\u2019s quarterly Tankan survey and it evidenced \t\ta significant increase in business confidence. \u00a0Yesterday, Bank of Japan \t\texpanded its quantitative easing program. The central bank doubled its \t\tthree-month lending facility to \u00a520 trillion.\u00a0 The move is not likely to \t\thave a significant impact on the real economy and may marginally \t\tincrease liquidity.\u00a0 The Policy Board vote in favour of the expansion \t\twas split and this suggests it may be difficult for BoJ policymakers to \t\tease policy further, no matter how much pressure the government applies \t\ton the central bank.\u00a0 Data released in Japan overnight saw the January \t\tleading index decline to 96.7 from 97.1 while the January coincident \t\tindex improved to 100.1.\u00a0 Data to be released overnight include February \t\tTokyo-area department store sales, February nationwide department store \t\tsales, and the January all-industry activity index.\u00a0 \u201cMr Yen\u201d Sakakibara \t\treported the U.S. dollar is still the global dominant reserve currency \t\tand said the U.S. appears to be moving away from its long-standing U.S. \t\t\u201cstrong dollar policy.\u201d\u00a0 The Nikkei 225 stock index lost 0.95% to close \t\tat \u00a510,744.03. 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 \u00a5122.65 level and was capped around the \u00a5124.25 level.\u00a0 \t\tThe British pound moved lower <\/strong>vis-\u00e0-vis the yen as sterling \t\ttested bids around the \u00a5137.00 figure while the Swiss franc moved \t\tlower <\/strong>vis-\u00e0-vis the yen and tested bids around the \u00a584.75 level. In Chinese news<\/strong>, the U.S. dollar appreciated vis-\u00e0-vis the Chinese \t\tyuan as the greenback closed at CNY 6.8264 in the over-the-counter \t\tmarket, up from CNY 6.8259. \u00a0People\u2019s Bank of China reported the first \t\tquarter business climate index rose 2.2% q\/q, the fourth quarterly \t\texpansion.\u00a0 U.S. Ambassador to China Huntsman verbally intervened today, \t\tsaying the U.S. \u201chopes to see more flexibility on the exchange rate. I \t\twould be misleading you if I left you with the impression that this \t\twasn\u2019t a very, very important issue in the United States, and will \t\tcontinue to be. We\u2019ll see how the next few weeks play out.\u201d\u00a0 The central \t\tbank is expected to tighten monetary policy further imminently and there \t\tis talk that final private demand in China is increasing.<\/p>\n

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

The British pound depreciated vis-\u00e0-vis \t\tthe U.S. dollar today<\/strong> as cable tested bids around the US$ 1.5215 \t\tlevel and was capped around the $1.5325 level. \u00a0Data released in the \t\tU.K. today saw the March CBI quarterly industrial trends survey improve \t\tto -37 from the prior reading of -39.\u00a0 February public sector net \t\tborrowing rocketed higher to \u00a312.0 billion with the public sector net \t\tcash requirement at \u00a37.7 billion.\u00a0 Also, February mortgage approvals \t\tcame in at 48,000.\u00a0 Bank of England yesterday reported it is considering \t\tan extension of the eligible collateral at its discount window.\u00a0 Cable \t\tbids are cited around the US$ 1.4455 level.\u00a0 The euro moved lower<\/strong> vis-\u00e0-vis the British pound as the single currency tested bids around \t\tthe US$ 0.8915 level and was capped around the \u00a30.8970 level.<\/p>\n

CHF<\/strong><\/p>\n

The Swiss franc weakened vis-\u00e0-vis the \t\tU.S. dollar today<\/strong> as the greenback tested offers around the CHF \t\t1.0645 level and was supported around the CHF 1.0530 level. Data \t\treleased in Switzerland overnight saw Q4 industrial production rise 6.4% \t\tq\/q and decline 1.1% y\/y while the February trade surplus declined to \t\tCHF 1.29 billion from CHF 2.42 billion.\u00a0 The euro\/ Swiss franc cross \t\tcame off to a fresh sixteen-month low amid declining expectations of \t\tadditional Swiss National Bank intervention.\u00a0 Also, the March ZEW \t\texpectations index climbed to 53.8 from 52.5 in February.\u00a0 The euro \t\tcame off<\/strong> vis-\u00e0-vis the Swiss franc as the single currency tested \t\tbids around the CHF 1.4355 level while the British pound moved lower<\/strong> vis-\u00e0-vis the Swiss franc.<\/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":"

Data released in the U.K. today saw the March CBI quarterly industrial trends survey improve to -37 from the prior reading of -39…<\/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-7705","post","type-post","status-publish","format-standard","hentry"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/posts\/7705","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=7705"}],"version-history":[{"count":0,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/posts\/7705\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/media?parent=7705"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/categories?post=7705"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/tags?post=7705"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}