Currency Report
Hello Everyone. Here is the new currency report for the week.
The Euro is expected to do well this week. Along with the "strong vigilance" rhetoric being played by the central bank, Malta is seeking to add itself to the growing Eurozone, making its currency more attractive. While this country's GDP is negligible to Germany's, it is a huge symbolic move. According to a Bloomberg survey, central banks are divesting their share of the US dollar, a move which will help to strengthen the Euro. Information from the Eurozone that is expected to be released are the PMI figures and money supply data.
The US dollar in contrast is expected to do a little worse as time passes and investors no longer feel that a rate hike is in the works. The economic releases are not expected to be positive to the dollar. The January durable goods report may not look so good as orders from Boeing have decreased and the demand for goods made to last more than 3 years has decreased. Higher oil prices may influence the consumer confidence report to the downside. The saving grace could be the housing market. A pickup in that sector would bring more positive news for the US Dollar. There is a change in the belief that unemployment lowers inflation in the ranks of the reserve. Should this hold true then the Federal Reserve will not raise rates preemptively.
The pound is expected to be flat this week. Housing prices grew by .7% however, some members believe that inflation will continue to fall and even dip below the 2% target rate over time. The lack of clarity in what is influencing the economy will keep the bank form taking action. The only pending release, which is expected to be alright is the mortgage approval data, to be released tomorrow.
The yen picked up some power from some hawkish comments on rising prices in Japan. There was also an increase in the output gap calculated at .6%. If the economy keeps strengthening then it will fuel more expectation that a rate hike is in the works. Repatriation this week would also bring strength. Be on the lookout for companies to begin doing so soon.
Australian and New Zealand Dollars have benefited due to rising prices in gold. Canada, however, did not benefit from the increase in oil, as the price action is a little exhaustive. Though its stock market hit a fresh new high, traders did not take that into account. New Zealand is reporting lower business confidence and export growth. Home sales from Australia and money supply data from New Zealand are the only data on deck for the commodity currency block.
In closing, happy trading to all of you out there and good luck.
Cordially,
Ian
The Euro is expected to do well this week. Along with the "strong vigilance" rhetoric being played by the central bank, Malta is seeking to add itself to the growing Eurozone, making its currency more attractive. While this country's GDP is negligible to Germany's, it is a huge symbolic move. According to a Bloomberg survey, central banks are divesting their share of the US dollar, a move which will help to strengthen the Euro. Information from the Eurozone that is expected to be released are the PMI figures and money supply data.
The US dollar in contrast is expected to do a little worse as time passes and investors no longer feel that a rate hike is in the works. The economic releases are not expected to be positive to the dollar. The January durable goods report may not look so good as orders from Boeing have decreased and the demand for goods made to last more than 3 years has decreased. Higher oil prices may influence the consumer confidence report to the downside. The saving grace could be the housing market. A pickup in that sector would bring more positive news for the US Dollar. There is a change in the belief that unemployment lowers inflation in the ranks of the reserve. Should this hold true then the Federal Reserve will not raise rates preemptively.
The pound is expected to be flat this week. Housing prices grew by .7% however, some members believe that inflation will continue to fall and even dip below the 2% target rate over time. The lack of clarity in what is influencing the economy will keep the bank form taking action. The only pending release, which is expected to be alright is the mortgage approval data, to be released tomorrow.
The yen picked up some power from some hawkish comments on rising prices in Japan. There was also an increase in the output gap calculated at .6%. If the economy keeps strengthening then it will fuel more expectation that a rate hike is in the works. Repatriation this week would also bring strength. Be on the lookout for companies to begin doing so soon.
Australian and New Zealand Dollars have benefited due to rising prices in gold. Canada, however, did not benefit from the increase in oil, as the price action is a little exhaustive. Though its stock market hit a fresh new high, traders did not take that into account. New Zealand is reporting lower business confidence and export growth. Home sales from Australia and money supply data from New Zealand are the only data on deck for the commodity currency block.
In closing, happy trading to all of you out there and good luck.
Cordially,
Ian
posted by Ian Bellamy at
5:38 PM
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