By: Barbara Zigah Commodity linked currencies, including the common currency Euro and the Australian Dollar, rebounded in Asian trading today with the Euro rising against the U.S. Dollar to $1.4387, a gain of 0.4%. More than any other single factor, the Euro is continuing to gain support from interest rate hike speculation, and recent encouraging business activity data from France and Germany supports that likelihood. Another commodity linked currency, the Australian Dollar, also struck a new 29-year high against the U.S. Dollar, trading at $1.0599.
Analysts say market jitteriness is being soothed by upbeat earnings reports in the U.S. and Europe, and investor sentiment is leaning toward higher risk currencies as the market well absorbed earlier concerns over Greek debt and a U.S. debt downgrade.
One analyst noted that investors are favoring currencies which offer higher yields at the Dollar and Yen’s expense, and a recent rise in the Asian equity market highlights investors’ sentiment toward risk-taking. The U.S. Dollar rose against the Japanese Yen, gaining 0.4% to trade at 82.91 Yen. The Euro also gained against the Japanese currency, climbing nearly 0.8% to trade at 119.27 Yen, well off a 2-week low of 116.49 Yen struck on the EBS trading platform earlier in the week.
http://www.dailyforex.com/forex-news/2011/04/Euro-Rebounds-in-Asia-on-Interest-Rate-Hike-Speculation/7726
Showing posts with label ForexNews. Show all posts
Showing posts with label ForexNews. Show all posts
Ireland Downgrade Only Marginally Affects Euro
By: Barbara Zigah According to some analysts, the divergence of the Federal Reserve’s monetary policy from that of the European Central Bank’s is what is driving the disparity between the U.S. Dollar and the common currency Euro. The Euro’s appreciation against the greenback appears proof of that theory, with the common currency hovering close to a 15-month high against the U.S. Dollar in Asian trading today.
As reported at 2:46 p.m. (JST) in Tokyo, the Euro is trading against the greenback at $1.4472, edging back 0.1% from late Thursday trading in New York but still within striking distance of the $1.4521 peak struck earlier in the week. Most market players don’t believe the Euro will face difficulty rising above $1.45, especially given the Eurozone’s debt problems and with Irelands’ credit rating being downgraded earlier today.
Recent rhetoric from several Federal Reserve officials has increased investor speculation that the central bank’s ultra loose monetary policy is likely to remain as such for an extended length of time. Collectively, the position of the Fed is that inflation – and the subsequent hikes in the prices of commodities – remains transitory and manageable by the current policy. The European Central Bank, conversely, continues to closely watch inflationary pressures and acknowledges that it is ready to move again with additional interest rate hikes if the situation warrants.
http://www.dailyforex.com/forex-news/2011/04/Ireland-Downgrade-Only-Marginally-Affects-Euro/7698
As reported at 2:46 p.m. (JST) in Tokyo, the Euro is trading against the greenback at $1.4472, edging back 0.1% from late Thursday trading in New York but still within striking distance of the $1.4521 peak struck earlier in the week. Most market players don’t believe the Euro will face difficulty rising above $1.45, especially given the Eurozone’s debt problems and with Irelands’ credit rating being downgraded earlier today.
Recent rhetoric from several Federal Reserve officials has increased investor speculation that the central bank’s ultra loose monetary policy is likely to remain as such for an extended length of time. Collectively, the position of the Fed is that inflation – and the subsequent hikes in the prices of commodities – remains transitory and manageable by the current policy. The European Central Bank, conversely, continues to closely watch inflationary pressures and acknowledges that it is ready to move again with additional interest rate hikes if the situation warrants.
http://www.dailyforex.com/forex-news/2011/04/Ireland-Downgrade-Only-Marginally-Affects-Euro/7698
Yen Slips Further while Euro Buoyed by Rate Hike
By: Barbara Zigah A day after a second earthquake struck the beleaguered island nation, the Japanese Yen fell broadly, striking multi-month lows against the U.S. Dollar and the common currency Euro. As reported at 1:22 p.m. (JST) in Tokyo, the Yen slipped against the U.S. Dollar to 85.140 Yen, a 0.3% decline and close to the 6-month low struck earlier in the week. The Yen also fell against the Euro, trading at 122.47 Yen, a decline of 0.7%, off from the 11-month low of 122.630 Yen hit on the EBS trading platform. As desired by the Bank of Japan, the Yen appears on the verge of weakening further says one forex head in Singapore.
The Euro is being buoyed by yesterday’s announcement of an ECB rate hike of 25 basis points. Against the U.S. Dollar the Euro struck a 15-month peak, trading at one point to a high of $1.4405. Investors had been keen to hear the press conference held afterward by Jean-Claude Trichet, the ECB President, but the bank’s direction remains somewhat unclear with the Bank in wait-and-see mode. Some economists are expecting that the ECB will hold the rate in check through July, when rising inflation will likely prompt another hike.
http://www.dailyforex.com/forex-news/2011/04/Yen-Slips-Further-while-Euro-Buoyed-by-Rate-Hike/7644
The Euro is being buoyed by yesterday’s announcement of an ECB rate hike of 25 basis points. Against the U.S. Dollar the Euro struck a 15-month peak, trading at one point to a high of $1.4405. Investors had been keen to hear the press conference held afterward by Jean-Claude Trichet, the ECB President, but the bank’s direction remains somewhat unclear with the Bank in wait-and-see mode. Some economists are expecting that the ECB will hold the rate in check through July, when rising inflation will likely prompt another hike.
http://www.dailyforex.com/forex-news/2011/04/Yen-Slips-Further-while-Euro-Buoyed-by-Rate-Hike/7644
Japanese Yen Continues Downtrend with G7 Intervention
By: Barbara Zigah The Japanese Yen slipped lower against the common currency and the Australian Dollar in Asian trading today, and analysts expect further weakening as risk appetite increases, generally. As reported at 2:52 p.m. (JST) in Tokyo at one point in the session on the EBS trading platform the Euro traded against the Yen at 123.33 Yen, a 16% gain from the mid-March trough of 106.50 Yen, before trimming gains to 122.62 Yen. The Australian Dollar also struck a 2 ½ year high against the Yen, when it struck 90.04 Yen earlier in the session; later, some of the gains were pared when it traded at 89.64 Yen still higher by 0.1%.
http://www.dailyforex.com/forex-news/2011/04/Japanese-Yen-Continues-Downtrend-with-G7-Intervention/7649
According to analysts, the Japanese central bank is likely to lag behind other countries’ central banks in order to give their nation a chance to recover from the tragic earthquake and tsunami which struck last month. The Japanese economy had been in a long period of stagflation, and most analysts agree that this event will likely shift the economy’s direction. The Japanese Yen had been a consistently strong currency prior to the earthquake, and repatriated flows endanger its resumption. The G7 has been collectively and successfully working to suppress the Yen’s rise.
http://www.dailyforex.com/forex-news/2011/04/Japanese-Yen-Continues-Downtrend-with-G7-Intervention/7649
Eurozone Debt Worries Resurface to Hold Euro Lower vs Dollar/Yen
By: Barbara Zigah In Asian trading today, as investor focus returns to Eurozone fiscal problems the common currency Euro extended earlier losses against the greenback after failing to break above key resistance. As reported at 2:51 p.m. (JST) in Tokyo, the Euro slipped against the U.S. Dollar to $1.4377, a 0.4% after another failed attempt to break above $1.45. The Euro also fell against the Japanese Yen, slipping to 118.94 Yen on the EBS trading platform, adding to last week’s losses.
The newest concern among market players is Finland, which last week’s regional elections sent the True Finns political party, considered anti-Euro by many political watchers, to the Finnish Parliament. According to the that government’s constitution, the Finnish parliament has the constitutional right to vote on all European Union requests for bailout assistance, suggesting it could hold up E.U. aid plans for Portugal specifically, as well as create instability, in general.
The only thing propping up the Euro at this point is that prospect that the European Central Bank will move to raise interest rates again following the recent data which showed Eurozone inflation rising higher to 2.7% as compared to the same period a year earlier; economists had expected an increase to 2.6% last month.
http://www.dailyforex.com/forex-news/2011/04/Eurozone-Debt-Worries-Resurface-to-Hold-Euro-Lower-vs-Dollar-Yen/7704
The newest concern among market players is Finland, which last week’s regional elections sent the True Finns political party, considered anti-Euro by many political watchers, to the Finnish Parliament. According to the that government’s constitution, the Finnish parliament has the constitutional right to vote on all European Union requests for bailout assistance, suggesting it could hold up E.U. aid plans for Portugal specifically, as well as create instability, in general.
The only thing propping up the Euro at this point is that prospect that the European Central Bank will move to raise interest rates again following the recent data which showed Eurozone inflation rising higher to 2.7% as compared to the same period a year earlier; economists had expected an increase to 2.6% last month.
http://www.dailyforex.com/forex-news/2011/04/Eurozone-Debt-Worries-Resurface-to-Hold-Euro-Lower-vs-Dollar-Yen/7704
U.S. Dollar Index Strikes 16-Month Trough in Asia
By: Barbara Zigah The U.S. Dollar Index slipped to a new 16-month low in Asian trading today as investor speculation that the U.S. Federal Reserve Bank might alter its currently loose monetary policy grows more remote. The U.S. Dollar Index, which gauges the greenback’s strength versus a weighted basket of major currencies slipped to 74.676 .DXY, a year to date loss of nearly 5%. Yesterday’s publication of the Federal Reserve Beige Book essentially confirmed the Fed’s view on inflation as temporary, with little to no likelihood that QE3 was in the making.
The common currency Euro, on the other hand, is approaching highs against the U.S. Dollar, as investors speculate that the ECB will continue to tighten monetary policy following the recently implemented interest rate hike. As reported at 2:58 p.m. (JST) in Tokyo, the Euro gained nearly 0.5% to trade at $1.4508, close to the 15-month peak of $1.4521. The U.S. Dollar also fell lower against the Japanese Yen, trading at one point at 83.20 Yen on the EBS trading platform, and well off the 6½ month peak of 85.55 Yen struck last week. One FX strategist in London pointed out that the U.S. Dollar has no new factors on which to rise, since it appears obvious that the Federal Reserve is not going to change its current stance anytime soon, given lingering high unemployment.
http://www.dailyforex.com/forex-news/2011/04/U.S.-Dollar-Index-Strikes-16-Month-Trough-in-Asia/7684
The common currency Euro, on the other hand, is approaching highs against the U.S. Dollar, as investors speculate that the ECB will continue to tighten monetary policy following the recently implemented interest rate hike. As reported at 2:58 p.m. (JST) in Tokyo, the Euro gained nearly 0.5% to trade at $1.4508, close to the 15-month peak of $1.4521. The U.S. Dollar also fell lower against the Japanese Yen, trading at one point at 83.20 Yen on the EBS trading platform, and well off the 6½ month peak of 85.55 Yen struck last week. One FX strategist in London pointed out that the U.S. Dollar has no new factors on which to rise, since it appears obvious that the Federal Reserve is not going to change its current stance anytime soon, given lingering high unemployment.
http://www.dailyforex.com/forex-news/2011/04/U.S.-Dollar-Index-Strikes-16-Month-Trough-in-Asia/7684
As ECB Meeting Looms, Euro Falls
By: Barbara Zigah Ahead of the European Central Bank’s policy and rate setting meeting which is set to begin later in the global day, the common currency fell from multi-month peaks against the Japanese Yen and the U.S. Dollar. The ECB has strongly hinted that an interest rate increase would be forthcoming, but now investors are pondering exactly how much of one might be under consideration. Most analysts expect an increase of 25 basis points for this, the first ECB rate hike in nearly three years. There is some speculation that by November the rate could be as much as 100 basis points higher, which the market already appears to be pricing in.
While the interest rate hike is not yet a done deal, many economists are suggesting that given the fiscal state of several of the Eurozone nations, i.e. Portugal, Spain, Greece, etc., an interest rate hike will be more harmful than good.
As reported at 2:57 p.m. (JST) in Tokyo, the Euro slipped against the U.S. Dollar, trading at $1.4297 following yesterday’s surge to $1.4350. Near term support is pegged around $1.4285 to $1.4250; some currency strategists say that if the Euro can’t rise well above $1.4282, it could retreat to near $1.4160. Against the Yen, the Euro was trading at121.77 Yen following yesterday’s 11-month peak. Most analysts agree that the long-term outlook for the Yen is on a downtrend.
http://www.dailyforex.com/forex-news/2011/04/As-ECB-Meeting-Looms-Euro-Falls/7631
While the interest rate hike is not yet a done deal, many economists are suggesting that given the fiscal state of several of the Eurozone nations, i.e. Portugal, Spain, Greece, etc., an interest rate hike will be more harmful than good.
As reported at 2:57 p.m. (JST) in Tokyo, the Euro slipped against the U.S. Dollar, trading at $1.4297 following yesterday’s surge to $1.4350. Near term support is pegged around $1.4285 to $1.4250; some currency strategists say that if the Euro can’t rise well above $1.4282, it could retreat to near $1.4160. Against the Yen, the Euro was trading at121.77 Yen following yesterday’s 11-month peak. Most analysts agree that the long-term outlook for the Yen is on a downtrend.
http://www.dailyforex.com/forex-news/2011/04/As-ECB-Meeting-Looms-Euro-Falls/7631
Dollar and Yen Strengthen After New Earthquakes Hit
By: Sara Patterson It’s been a month since the major earthquake that shook Japan, but a recent, smaller earthquake is causing the Yen to strengthen further. The currency was at 120.81 per Euro, up 1.1% from 122.12 in New York at the close of yesterday’s trading day. This is the Yen’s biggest daily gain since March 16. In JPY-USD trading, the Yen increased to 83.88 per dollar, up from 84.60. The US dollar also climbed yesterday, from $1.4436 to $1.44 per Euro.
In light of the recent disasters in Japan, the International Monetary Fund reduced its forecast for Japanese growth from 1.6 to 1.4. This behavior is typical for the Japanese currency during times of disaster. The IMF’s forecast for 2012 was raised from 1.8 percent to 2.1 percent.
http://www.dailyforex.com/forex-news/2011/04/Dollar-and-Yen-Strengthen-After-New-Earthquakes-Hit/7667
In light of the recent disasters in Japan, the International Monetary Fund reduced its forecast for Japanese growth from 1.6 to 1.4. This behavior is typical for the Japanese currency during times of disaster. The IMF’s forecast for 2012 was raised from 1.8 percent to 2.1 percent.
http://www.dailyforex.com/forex-news/2011/04/Dollar-and-Yen-Strengthen-After-New-Earthquakes-Hit/7667