{"id":8148,"date":"2010-03-31T16:20:14","date_gmt":"2010-03-31T20:20:14","guid":{"rendered":"http:\/\/countingpips.com\/fx\/?p=8148"},"modified":"2010-03-31T16:20:14","modified_gmt":"2010-03-31T20:20:14","slug":"forex-daily-market-commentary-35","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/fx\/2010\/03\/31\/forex-daily-market-commentary-35\/","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 appreciated vis-\u00e0-vis the U.S. \t\tdollar today<\/strong> as the single currency tested offers around the US$ \t\t1.3540 level and was supported around the $1.3385 level. \u00a0The common \t\tcurrency tested a key short-term retracement level today, representing \t\t50% of the March range.\u00a0 The pair gained ground even though there are \t\tsignificant doubts concerning the viability of Greece\u2019s plans to improve \t\tits massive fiscal deficits.\u00a0 The Greek government today indicated its \t\tMay debt servicing needs will be around \u20ac11.6 billion.\u00a0 Greece\u2019s new \t\tbond issue this week was not entirely well-received by investors and \t\tdealers are concerned that a significant amount of more supply of \t\tsovereign eurozone debt with deteriorating credit quality could imperil \t\tthe euro further. \u00a0The yield on Greek ten-year debt has increased about \t\t25bps since European leaders agreed to a financial aid package for \t\tGreece on 25 March and this evidences the market\u2019s discomfort with the \t\tcountry\u2019s severe problems. Data released in the eurozone today saw the \t\tEMU-16 February unemployment rate tick higher to 10.0% from 9.9%, as \t\texpected, while the March flash consumer price inflation estimate was up \t\t1.5% y\/y \u2013 its highest level in ten months.\u00a0 Germany posted its largest \t\tdecline in jobless claims since August 2008 and the March unemployment \t\trate fell to 8.0%.\u00a0 German February retail sales will be released \t\ttomorrow. French data released today saw February producer prices climb \t\t0.1% m\/m and 1.0% y\/y.\u00a0 Despite today\u2019s increase in headline eurozone \t\tinflation, the rate is still below the European Central Bank\u2019s perceived \t\tcomfort zone of 2.0% and given the backdrop of the sovereign credit \t\tcrunch, a move higher in official interest rates is very unlikely for \t\tquite some time. \u00a0ECB President Trichet said it is \u201cextremely important \t\tto anchor inflation expectations.\u201d In U.S. news<\/strong>, data released \t\ttoday saw MBA mortgage applications climb 4.3% in the latest week while \t\tFebruary factory orders fell to +0.6% from a revised +2.5% in January.\u00a0 \t\tAlso, March Chicago PMI fell back to 58.8 from the prior reading of \t\t62.6.\u00a0 The most important data released today saw March ADP employment \t\toff 23,000, a slight improvement from the revised prior reading of \t\t-24,000.\u00a0 These data represent private sector job losses and some \t\teconomists may scale back their forecasts for Friday\u2019s non-farm payrolls \t\treport with many forecasts currently focusing on job gains around \t\t185,000.\u00a0 Atlanta Fed President Lockhart said he is watching for \t\t\u201cdurable\u201d job gains while Dallas Fed President Fisher said the U.S. \t\tcannot ignore the impact of its massive deficit of yields.\u00a0 Fed Governor \t\tDuke reported U.S. banks remain weak and noted the decrease in bank \t\tlending is very troubling.\u00a0 Euro bids are cited around the US$ 1.3335 \t\tlevel.<\/p>\n

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

The yen depreciated \t\tvis-\u00e0-vis the U.S. dollar today<\/strong> as the greenback tested offers \t\taround the \u00a593.60 level and was supported around the \u00a592.75 level. \t\t\u00a0Traders await the release of the all-important Bank of Japan Tankan \t\tsurvey of corporate sentiment tonight with most forecasts focusing on an \t\timprovement in the main large manufacturers\u2019 confidence index to -14 \t\tfrom the prior reading of -24.\u00a0 Other components include the large \t\tmanufacturing outlook, large non-manufacturing outlook, and capex \t\tnumbers with large all-industry capex expected to improve to -0.4% in Q1 \t\tfrom -13.8% in Q4.\u00a0 Even though the Tankan is expected to evidence \t\timprovement across the board, the survey does little to address the weak \t\tfinal private demand in the country and the deflationary problems \t\tevident in the economy.\u00a0 Data released in Japan overnight saw March \t\tsmall business confidence improve to 45.8 from the prior reading of \t\t42.3while February housing starts were off 9.3% y\/y to an annualized \t\t794,000.\u00a0\u00a0 Additionally, February construction orders were off 20.3% y\/y \t\tand February total cash earnings data were off 0.6% y\/y.\u00a0 Today is the \t\tfinal day of Japan\u2019s fiscal year-end and most dealers believe the yen \t\twill continue to depreciate early in the new fiscal year.\u00a0 The \t\tgovernment will boost Japanese government bond issuance to a record \t\t\u00a5144.3 trillion in the fiscal year beginning tomorrow.\u00a0 The Nikkei 225 \t\tstock index lost 0.06% to close at \u00a511,089.94. U.S. dollar offers are \t\tcited around the \u00a594.75 level.\u00a0 The euro moved higher <\/strong>vis-\u00e0-vis \t\tthe yen as the single currency tested offers around the \u00a5126.45 level \t\tand was supported around the \u00a5124.40 level.\u00a0 The British pound moved \t\thigher <\/strong>vis-\u00e0-vis the yen as sterling tested offers around the \t\t\u00a5141.80 level while the Swiss franc moved higher <\/strong>vis-\u00e0-vis the \t\tyen and tested offers around the \u00a588.80 level. In Chinese news<\/strong>, \t\tthe U.S. dollar appreciated vis-\u00e0-vis the Chinese yuan as the greenback \t\tclosed at CNY 6.8259 in the over-the-counter market, up from CNY 6.8257. \t\t\u00a0It was reported that Chinese banks purchased US$ 978 billion in foreign \t\tcurrency for their clients in 2009, selling yuan in the process.\u00a0 \t\tPeople\u2019s Bank of China reported the economic recovery has been \u201cfurther \t\tcemented\u201d and added the management of liquidity following the record \t\tcredit expansion has become \u201carduous.\u201d\u00a0 PBoC called on China to urgently \t\tadjust its economic model and said it must utilize multiple monetary \t\ttools \u201cflexibly.\u201d\u00a0 Some traders believe China may widen the yuan\u2019s \t\ttrading band in the second quarter.<\/p>\n

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

The British pound appreciated vis-\u00e0-vis \t\tthe U.S. dollar today<\/strong> as cable tested offers around the US$ 1.5185 \t\tlevel and was supported around the $1.5040 level. \u00a0Data released in the \t\tU.K. today saw GfK March consumer confidence tick lower to -15 from -14 \t\tin February.\u00a0 March PMI manufacturing data will be released tomorrow and \t\tliquidity will be light early next week on account of the U.K. Easter \t\tMonday market holiday.\u00a0 Cable bids are cited around the US$ 1.4455 \t\tlevel.\u00a0 The euro moved higher<\/strong> vis-\u00e0-vis the British pound as the \t\tsingle currency tested offers around the \u00a30.8945 level and was supported \t\taround the \u00a30.8870 level.<\/p>\n

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

The Swiss franc appreciated vis-\u00e0-vis \t\tthe U.S. dollar today<\/strong> as the greenback tested bids around the CHF \t\t1.0520 level and was capped around the CHF 1.0685 level. \u00a0SNB Board \t\tmember Danthine said the central bank will prevent \u201cany excessive \t\tappreciation of the Swiss franc\u201d and added it has \u201cthe means to achieve \t\tthat objective, without dispute.\u201d\u00a0 Data released in Switzerland today \t\tsaw the March KOF indicator rise to 1.93 from an upwardly-revised 1.70 \t\tin February.\u00a0 Swiss National Bank Vice Chairman Jordan reiterated last \t\tweek that the central bank will work to prevent excessive franc \t\tappreciation.\u00a0 Swiss National Bank President Hildebrand last week \t\treported the central bank will \u201cdecisively\u201d act against \u201cexcessive\u201d \t\tfranc strength, noting the central bank can intervene to a \u201cvery large \t\textent.\u201d\u00a0 U.S. dollar offers are cited around the CHF 1.1180 level. The euro moved lower<\/strong> vis-\u00e0-vis the Swiss franc as the single \t\tcurrency tested bids around the CHF 1.4240 level while the British \t\tpound moved lower<\/strong> vis-\u00e0-vis the Swiss franc and tested bids around \t\tthe CHF 1.5925 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":"

Traders await the release of the all-important Bank of Japan Tankan survey of corporate sentiment tonight with most forecasts focusing on an improvement in the main large manufacturers\u2019 confidence index to -14 from the prior reading of -24…<\/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-8148","post","type-post","status-publish","format-standard","hentry"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/posts\/8148","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=8148"}],"version-history":[{"count":0,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/posts\/8148\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/media?parent=8148"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/categories?post=8148"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/tags?post=8148"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}