Forex Daily Digest's Blog – December 2009 Archive (11)

Investors turned bullish on the USD for the first time since March as the U.S. economy showed evidence of a sustained recovery. The Fed is likely to leave the bank's short-term interest rate target intact at 0% to 0.25% at the end of the FOMC meeting today, and is not expected to significantly change language in its statement promising not to raise rates for a very long time. Yesterday, the USD rose to the highest level in more than two months as stronger-than-expected U.S. economic reports… Continue

The USD rose to a two- month high against the EUR on the possibility that improving economic data in the U.S. will encourage the Federal Reserve to indicate an exit from policies intended to fight the recession. The U.S. dollar increased against 15 of its 16 major counterparts as futures indicated a 49.5 percent chance that the Fed, which began two days of policy meetings today, will raise its key rate by at least a quarter-percentage point by June, from near zero.



Canada’s dollar… Continue

The USD advanced against the EUR, JPY and other major currencies to finish the week, pushing it to the highest in two months, after a marked uptick in consumer sentiment bolstered expectations of a U.S. economic recovery. Data showing U.S. retail sales jumped more than twice as much as expected in November turned the dollar higher, reversing losses notched during European and Asian trading hours.



The USD is expected to continue recent gains this week due to optimism that the U.S.… Continue

The USD recovered early today after U.S. Retail Sales beat the economist’s consensus estimates. Retail sales rose a better-than-expected 1.3% in November which is the third increase in the past four months. The sales gains were widespread across most kinds of retail outlets, including autos, gasoline, department stores and hardware stores. Only clothes and furniture store sales declined. The consensus forecast of Wall Street economists was for retail sales to rise 0.5%.



The CAD moved… Continue

The USD is expected to extend its fall from almost a one-month high against the EUR after a rebound in U.S. stocks revived demand for higher-yielding assets. Meantime, the price of gold advanced, trimming this week’s loss, as a fall in the USD revived investor appetite for the precious metal as an alternative asset.



Economic reports released this morning included the Initial Jobless Claims report. The number of people filing claims for state unemployment benefits rose by 17,000 to a… Continue

The USD shed as much as one percent of its value against the JPY as the Japanese currency rallied, continuing its bounce back this week from heavy selling the previous week. Yesterday, the USD increased to its highest level against the EUR in five weeks and gained against other major currencies, as worries about high levels of debt in Greece and Dubai led investors to buy assets that would offer protection in a crisis.



Crude oil climbed, ending a five- day decline, as the USD fell… Continue

The USD gained as much as 0.7 percent against the EUR, climbing to a one-month high. Gold firmed up, moving away from a two-week low marked the previous day as the dollar weakened after the Federal Reserve chief cautioned that the U.S. economic recovery remains fragile. Gold typically moves inversely to the dollar and has added 30 percent this year as record-low Federal Reserve interest rates contributed to the currency’s 5.3 percent drop. Some central banks have bought bullion, helping to push… Continue

The USD was slightly higher against major rivals other than the JPY this morning, continuing Friday's sharp rally in the wake of a much smaller-than-expected drop in November non-farm payrolls and unexpected drop in the unemployment rate.



Gold futures fell more than 2%, extending their sharp losses, as the USD rose against its major rivals, reducing the appeal of bullion as a hedge against the currency's depreciation. Gold and the dollar have had a strong inverse relationship. The… Continue

The USD regained most of its earlier losses, after comments from European Central Bank President Jean-Claude Trichet about U.S. officials' support for the U.S. currency. A variety of U.S. data also left currency traders with little direction before the main event on Friday: the government's monthly payrolls report.



The ISM's nonmanufacturing index fell to 48.7 from 50.6 in October. Economists surveyed were expecting the index to rise to 51.5. The dollar was under pressure after the… Continue

The USD held steady near the lowest level in 15 months against the EUR after ADP said U.S. companies cut 169,000 jobs in November, compared to a 203,000 loss the previous month. The dollar held gains against the JPY after Japanese Prime Minister Yukio Hatoyama reportedly said the yen's rise can't be left "as is," thus speculating that policy makers could move to limit gains. Later, a spokesman said Hatoyama wasn't signaling that the government was set to intervene.



The Bank of Japan,… Continue

The USD remained modestly higher against the JPY after the Bank of Japan decided to make available 10 trillion yen for short-term loans to commercial banks in an effort to fight off deflationary pressures. The USD and the JPY were both lower against most major rivals, as investors rejected low-yielding currencies in favor of higher-yielding assets. Concerns over Dubai's debt problems faded and a gauge of manufacturing activity in China indicated the fastest pace of expansion in five years. The… Continue