Disappointing economic news in the US has raised fears that demand for commodities including oil could decline in the coming months. This has seen commodity prices fall causing the Canadian dollar to drop to 101.94 cents US.
“The weak data have increased the downside risks for Canadian dollar ahead of domestic data releases this week that include international trade and employment,” noted Scotia Capital chief currency strategist Camilla Sutton.
Source: The Canadian Press
After nearly a year on credit watch, Standard & Poor’s acted today cutting Japan’s credit rating to AA-. News of the rating reduction sent the yen lower by 0.9 percent to 82.89 yen to the dollar from 82.17 at yesterday’s close.
“News of Japan’s rating downgrade spurred yen selling as it occurred,” said Koji Fukaya, chief currency strategist at Credit Suisse Group AG in Tokyo. “With domestic investors holding most of Japanese government bonds, the direct impact on the currency market will likely be small. Still, in the near term, the market will likely take this as a negative.”
Source: Bloomberg
The euro rose almost a full percent to $1.3101 by 6:45 am in New York this morning as speculation grows that the European Central Bank (ECB) will provide an aggressive action plan to deal with spreading European debt. The Bank is scheduled to meet tomorrow and some analysts suggest the region’s central bank will announce wide-spread bond purchases to prop-up sovereign debt.
“Trichet reluctantly refused to rule out the possibility of expanding government-bond purchases,” said Simon Derrick, chief currency strategist at Bank of New York Mellon Corp. in London. “There’s a possibility the ECB could step up to the plate sometime soon. Do I think there could be a euro bounce today? Yes. Do I think it will be sustained? Probably not.”
Source: Bloomberg
In an interview with China Reform magazine, Yi Gang, China’s chief currency regulator, said that China has surpassed Japan to become the world’s second-largest economy. Gang also noted that depending on how fast its exchange rate rises, China is set to overtake the US economy around 2025.
Source: Reuters
Powered by Efacilitators Hosting