{"id":8771,"date":"2010-04-22T15:57:26","date_gmt":"2010-04-22T19:57:26","guid":{"rendered":"http:\/\/countingpips.com\/fx\/?p=8771"},"modified":"2010-04-22T15:57:26","modified_gmt":"2010-04-22T19:57:26","slug":"forex-daily-market-commentary-47","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/fx\/2010\/04\/22\/forex-daily-market-commentary-47\/","title":{"rendered":"Forex Daily Market Commentary"},"content":{"rendered":"

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

Fundamental Outlook at 1400 GMT (EDT + 0400)<\/strong><\/p>\n

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

The euro depreciated vis-\u00e0-vis the U.S. dollar today as the single currency tested bids around the US$ 1.3255 level and was capped around the $1.3420 level.\u00a0 The common currency continues to weaken on worsening conditions in Greece.\u00a0 The European Union is now estimating that Greece\u2019s 2009 deficit is worse than previously reported and Moody\u2019s Investors Service downgraded the government\u2019s debt ratings to A3 from A2.\u00a0 Many dealers expected a greater credit downgrade. Credit default swaps on Greek five-year debt surged 91 basis points to a record 577 and ten-year bond yields touched 9%, the highest level since 1998.\u00a0 All of these factors render it increasingly likely Greece will be forced to accept a bailout from eurozone partners and\/ or the International Monetary Fund.\u00a0 Greece may be forced to reduce or postpone payments to bond investors for now.\u00a0 Data released in the eurozone today saw April PMI services print at 55.5, up from the prior reading of 54.1, while EMU-16 consumer confidence improved to -15 in April from -17.\u00a0 It was also reported that the eurozone\u2019s debt-to-GDP ration escalated to 78.7% at the end of 2009 from 69.4% at the end of 2008.\u00a0 In U.S. news, data released today saw the March headline producer price index climb 0.7% m\/m and 6.0% y\/y while the core rate was up 0.7% m\/m and 0.9% y\/y.\u00a0 Also, weekly initial jobless claims fell to 456,000 from the revised prior reading of 480,000 while continuing jobless claims fell to 4.646 million from the prior reading of 4.686 million.\u00a0 Moreover, March existing home sales were up 6.8% m\/m to an annualized 5.35 million units and the February house price index was off 0.2% m\/m.\u00a0 President Obama called for a financial overhaul that would offer the \u201cstrongest consumer protection ever.\u201d\u00a0 Obama\u2019s plan calls for a ban on future bank bailouts.\u00a0 Euro bids are cited around the US$ 1.3175 level.<\/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 \u00a593.35 level and was supported around the \u00a592.75 level.\u00a0 There is increasing speculation the BoJ will raise its outlook for the economy and prices next week amid positive improvements in certain economic measures including the export sector, the unemployment rate, and consumer confidence.\u00a0 The Democratic Party of Japan reported it will likely call for an inflation target for the central bank in this year\u2019s election platform.\u00a0 It is likely legislators will try and prompt the central bank to seek inflation of up to two per cent.\u00a0\u00a0 The International Monetary Fund this week called on Japan to enact a \u201ccredible\u201d medium-term fiscal plan.\u00a0 Bank of Japan Governor Shirakawa warned complacency is the \u201cmost dangerous risk\u201d for central banks and said \u201cover-confidence\u201d damaged Japan and the U.S.\u00a0 Finance minister Kan said concerns over Japan\u2019s terrible debt situation will ease when a new fiscal plan is issued.\u00a0 Data released overnight saw March supermarket sales off 6.6% y\/y.\u00a0 The Nikkei 225 stock index lost 1.27% to close at \u00a510,949.09.\u00a0 U.S. dollar offers are cited around the \u00a596.85 level.\u00a0 The euro moved lower vis-\u00e0-vis the yen as the single currency tested bids around the \u00a5123.30 level and was capped around the \u00a5125.15 level.\u00a0 The British pound moved lower vis-\u00e0-vis the yen as sterling tested bids around the \u00a5142.40 level while the Swiss franc moved lower vis-\u00e0-vis the yen and tested bids around the \u00a586.00 figure. In Chinese news, the U.S. dollar appreciated vis-\u00e0-vis the Chinese yuan as the greenback closed at CNY 6.8264 in the over-the-counter market, down from CNY 6.8275. People\u2019s Bank of China sold bills at lower yields for the first time in fifteen months, evidencing the banking system\u2019s large surplus of cash. Many China-watchers believe China may allow the yuan to appreciate at any time between now and the end of the quarter.<\/p>\n

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

The British pound depreciated vis-\u00e0-vis the U.S. dollar today as cable tested bids around the US$ 1.5340 level and was capped around the $1.5470 level.\u00a0 Data released in the U.K. today saw March retail sales climb 0.4% m\/m and 2.2% y\/y while the March public sector net cash requirement grew to \u00a325.8 billion from February\u2019s level of \u00a38.0 billion.\u00a0 Also, March public sector net borrowing printed at \u00a323.5 billion, up from the prior reading of \u00a39.7 billion.\u00a0 Additionally, March mortgage approvals grew marginally to 52,000 from the prior reading of 48,000 and the March M4 money supply expanded 0.1% m\/m and 3.5% y\/y.\u00a0 Minutes from Bank of England Monetary Policy Committee\u2019s April meeting were released yesterday and they revealed a unanimous vote to keep interest rates unchanged and the central bank\u2019s asset purchase plan unchanged at \u00a3200 billion.\u00a0 Traders are talking about a surge in the polls by the Liberal Democratic Party and the likely impact this will have on the 6 May General Election.\u00a0 Many political pundits believe the contest will result in a hung Parliament and some now say the general election is too close to call with Cameron perhaps still holding a slight lead over Brown.\u00a0 Cable bids are cited around the US$ 1.5140 level.\u00a0 The euro moved lower vis-\u00e0-vis the British pound as the single currency tested bids around the \u00a30.8630 level and was capped around the \u00a30.8695 level.<\/p>\n

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

The Swiss franc depreciated vis-\u00e0-vis the U.S. dollar today as the greenback tested offers around the CHF 1.0805 level and was supported around the CHF 1.0670 level.\u00a0 Swiss National Bank and Swiss regulators announced new regulations today that mandate UBS and Credit Suisse to hold larger amounts of reserves to defend against crisis scenarios.\u00a0 Data released in Switzerland today saw the March trade balance expand to CHF 2.01 billion from the prior reading of CHF 1.29 billion while the April ZEW expectations survey fell back to 53.4 from 53.8.\u00a0 Dealers continue to cite talk that Swiss National Bank may be intervening by bidding the euro\/ franc cross higher.\u00a0 U.S. dollar offers are cited around the CHF 1.0920 level.\u00a0 The euro moved lower vis-\u00e0-vis the Swiss franc as the single currency tested bids around the CHF 1.4320 level while the British pound moved higher vis-\u00e0-vis the Swiss franc and tested offers around the CHF 1.6580 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":"

By GCI Forex Research Fundamental Outlook at 1400 GMT (EDT + 0400) \u20ac The euro depreciated vis-\u00e0-vis the U.S. dollar today as the single currency tested bids around the US$ 1.3255 level and was capped around the $1.3420 level.\u00a0 The common currency continues to weaken on worsening conditions in Greece.\u00a0 The European Union is now … <\/p>\n

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