Forex Blog

February 2, 2012

China to Play the Eurozone’s White Knight?

Filed under: OANDA News — Tags: , , , , , , , — admin @ 2:27 pm

Since the early days of the Eurozone debt crisis, insiders have identified China and its $3.2 trillion in foreign reserves as a potential contributor to a Eurozone bailout fund. Today, Premier Wen Jiabao gave markets reason to believe this may yet be the case when Wen suggested that China is considering the options for how it may contribute to keeping the Eurozone together.

The original European Financial Stability Fund (EFSF) is scheduled to be superseded by the European Stability Mechanism (ESM) later this year. The ESM is expected to provide 500 billion euros ($656 billion) to the establishment of a bailout fund. Wen did not confirm whether China would contribute to the ESM directly, but this does seem to be the most logical way China could help support the region.

China Desires a Stable Euro and Eurozone

It is in China’s interest to help stabilize the Eurozone. It is estimated that up to one quarter – or roughly 620 billion euros – of China’s foreign exchange is held in euros. Shielding this investment from further decline is obviously of vital importance to China.

However, China also wants to see prosperity return to the region as quickly as possible to protect its export interests. The wider European Union is China’s largest export market with 282 billion euros worth of goods exported in 2010. Sales for 2011 continued to increase but at a slower pace and there is a growing worry that sales could soon start to decline.

German Chancellor Angela Merkel arrived in China today to kick off a three-day visit aimed largely at reassuring China that European leaders have a handle on the debt crisis.

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September 1, 2011

U.S. Unemployment Claims Fall to 409,000

Filed under: OANDA News — Tags: , , , , , , , , , , , — admin @ 7:52 am

New claims for U.S. unemployment benefits fell by 12,000 to 409,000 last week. It is generally accepted that a sustainable rate of job growth requires new claims to fall below a weekly average of 375,000. The U.S. Labor Department notes that new claims have exceeded this number every week since last February.

While the claims trend appears to be declining, the read on the latest result suggests that layoffs have not yet increased despite growing concerns that the economy is moving towards another recession. What is clear however, is that new jobs are being created at a slower pace than earlier this year and this has kept the unemployment rate elevated at 9.1 percent.

Source: Associated Press

Eurozone Manufacturing Sinks to 2-Year Low

Filed under: OANDA News — Tags: , , , , , , , , , , , — admin @ 7:27 am

The latest Markit Manufacturing Production Manager’s Index (PMI) indicates that manufacturing in the Eurozone countries fell more than expected to a 2-year low of 49 with any reading under 50 indicating contraction. The previous month’s index reading was 50.4.

Not surprisingly, Germany had the strongest individual reading at 50.9 while Greece recorded the weakest result at 43.3. Manufacturing activity in France, Italy, and Spain also declined during the month.

“Final PMI data for August were even worse than the earlier disappointing flash numbers, signalling an end to the manufacturing recovery which began in 2009,” said Chris Williamson, chief economist at Markit.

“Worryingly, Germany saw new export orders fall at the fastest rate of all countries surveyed, meaning the eurozone can no longer rely on export-led growth in its largest member state to help sustain even a lacklustre recovery for the region as a whole.”

Source: BBC News

December 24, 2010

US Consumer Spending Up 0.4%

Filed under: OANDA News — Tags: , , , , , , , , , , , — admin @ 1:58 pm

The US Commerce Department reported a 0.4 percent increase in consumer spending for the month of November while consumer incomes rose 0.3 percent. The latest results provide further evidence that the US economy is on the mend albeit at a slower pace than past recoveries.

Source: BBC News

July 14, 2010

Euro Gains as Dollar Stumbles

Filed under: OANDA News — Tags: , , , , , , , — admin @ 1:19 pm

A weaker-than-expected retail sales report took the steam out of the dollar on Wednesday despite an encouraging start to the so-called “earnings week” rally. The euro managed to climb above $1.27 to $1.2714 as the dollar fell against most major currencies.

The message coming out of the US this morning suggests that the US economy is still on the path to recovery, but at a slower pace than previously expected. Businesses are starting to spend again, but consumers remain cautious and this will likely slow the rate of recovery in the US.

June 4, 2010

US Employment Rises 431,000 But Most Temporary Positions

Filed under: OANDA News — Tags: , , , , , , , , , , , — admin @ 12:46 pm

The Non-Farm Payroll employment report for May shows an increase of 431,000 new hires for the month. This was fewer than the 536,000 predicted and a closer look reveals that of the 431,000 new positions, 411,000 were temporary positions created to conduct the 2010 US census.
Private payroll also rose, but at a slower pace than expected with only 41,000 new positions created.

“It’s going to be a long haul,” Michael Englund, chief economist at Action Economics LLC in Boulder, Colorado, said before the report. “We really aren’t adding many jobs. We’ve lost some momentum in the economy and final sales clearly aren’t enough to generate job growth.”

Source: Reuters

February 26, 2010

Swiss Feb Kof barometer strongest since late 2007

Filed under: OANDA News — Tags: , , , , , , , , , , , , , — admin @ 6:16 am

Switzerland’s leading KOF economic growth barometer rose to its highest since December 2007 in February, beating analysts’ expectations and confirming views that the economy was on track for a solid recovery.

The barometer increased to 1.87 points in February, the KOF Swiss Economic Institute said, more than the 1.80 reading forecast by analysts ECONCH. January’s reading was revised up to 1.81 from 1.77.

The barometer surged last year, though the monthly increases have slowed recently, indicating that the recovery would likely continue at a slower pace. Switzerland emerged from the worst recession in decades over the summer and several recent indicators have pointed to further recovery, though economists expect joblessness to peak later
this year.

Reuters

November 5, 2009

Kiwi Flys South!

Filed under: Forex News — Tags: , , , , , , , , , — admin @ 7:51 am

The New Zealand dollar, otherwise known as the Kiwi, is the biggest loser of the morning so far.  Unemployment in New Zealand is at the highest its been since 2000, to 6.5%.   Reserve bank governor Bollard said that the nation’s recovery would be at a slower pace than Australia’s.

The Kiwi, a flightless bird, is down .66% vs. JPY and .42% vs, USD.  What’s important to note here is that a lot of times we just group some of these currencies together as the “risk trade” or as the “commodity currencies”.  The reason I note this is because as of this writing, the Australian dollar or Aussie, is positive against most other currencies.

So even though the US stock market is up and the risk-taking trade appears to be in effect, it is important to remember the ffundamentals of individual currencies as well.

My guess is that sometime today, the Kiwi will trade back to fall in line with the overall risk trade.  I’m going to look at some charts in a bit to see if there is anything to note.

So check back later!

To learn about how things like unemployment reports can affect a nation’s currency, be sure to check out our affordable currency trading courses!

Tags: Aussie, Australia, bank, charts, commodity, course, currenc, currency, currency trading, dollar, dow, fundamental, fx, fxedu, jpy, Kiwi, lot, lower, market, Mike Conlon, new zealand, new zealand dollar, ssi, stock, time, trade, unemployment, USD

Kiwi Flys South!

Filed under: Forex News — Tags: , , , , , , , , , , , , — admin @ 7:51 am

The New Zealand dollar, otherwise known as the Kiwi, is the biggest loser of the morning so far.  Unemployment in New Zealand is at the highest its been since 2000, to 6.5%.   Reserve bank governor Bollard said that the nation’s recovery would be at a slower pace than Australia’s.

The Kiwi, a flightless bird, is down .66% vs. JPY and .42% vs, USD.  What’s important to note here is that a lot of times we just group some of these currencies together as the “risk trade” or as the “commodity currencies”.  The reason I note this is because as of this writing, the Australian dollar or Aussie, is positive against most other currencies.

So even though the US stock market is up and the risk-taking trade appears to be in effect, it is important to remember the ffundamentals of individual currencies as well.

My guess is that sometime today, the Kiwi will trade back to fall in line with the overall risk trade.  I’m going to look at some charts in a bit to see if there is anything to note.

So check back later!

To learn about how things like unemployment reports can affect a nation’s currency, be sure to check out our affordable currency trading courses!

Tags: Aussie, Australia, bank, charts, commodity, course, currenc, currency, currency trading, dollar, dow, fundamental, fx, fxedu, jpy, Kiwi, lot, lower, market, Mike Conlon, new zealand, new zealand dollar, ssi, stock, time, trade, unemployment, USD

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