The Forex Daily Digest – January 20, 2010
The USD gained after data showed mild inflation and an increase in future housing permits. The EUR dropped to a five-month low against the USD as fears that Chinese efforts to restrain lending led investors to avoid risky assets and concerns about Greece's budget problems sent kept pressure on the EUR.
International Monetary Fund Managing Director Dominique Strauss-Kahn said the euro region will survive the turmoil caused by Greece’s credit downgrade, a day after finance chiefs expressed concern that debt problems are spreading. Policy makers gathering in Brussels yesterday called on Greece to take more action to contain the situation.
The JPY and USD rose and stocks fell over concern that China’s lending decision would slow the global economic recovery. The AUD and NZD declined for a second day on apprehension over China, slowing demand for higher- yielding assets. The NZD also fell against all of its 15 most-active counterparts after a government report showed consumer prices unexpectedly fell last quarter, reducing speculation the central bank will raise interest rates.
The CAD dropped to the lowest level in two weeks as oil fell and a report showed consumer prices rose less last month than forecast, reducing the chance the central bank will raise rates before the second half. Consumer prices rose 1.3 percent in December from a year earlier after gaining 1 percent in the previous month. The median forecast of economists was for a 1.6 percent rise.
Some changes in the Canadian government were made this week. Canadian Prime Minister Stephen Harper shuffled his cabinet to put more focus on the economic recovery. He also made it clear the government would have to restrain the growth of spending. As expected, Harper left Finance Minister Jim Flaherty at his post. He also moved Stockwell Day from the Trade Department to the Treasury Board, where he will be responsible for helping to tame the budget deficit.
On Thursday’s economic calendar look for the Initial Jobless Claims for the week of January 16, Leading Indicators for December, the January Philadelphia Fed Index and Crude Oil Inventories for the week of January 15. Scheduled earnings include Fifth Third Bank, Imation, Goldman Sachs, Legg Mason, PNC Bank, Continental Airlines, Southwest Air, Union Pacific, Xerox, American Express, Capital One, and Google.
Happy Trading,
James Dicks
International Monetary Fund Managing Director Dominique Strauss-Kahn said the euro region will survive the turmoil caused by Greece’s credit downgrade, a day after finance chiefs expressed concern that debt problems are spreading. Policy makers gathering in Brussels yesterday called on Greece to take more action to contain the situation.
The JPY and USD rose and stocks fell over concern that China’s lending decision would slow the global economic recovery. The AUD and NZD declined for a second day on apprehension over China, slowing demand for higher- yielding assets. The NZD also fell against all of its 15 most-active counterparts after a government report showed consumer prices unexpectedly fell last quarter, reducing speculation the central bank will raise interest rates.
The CAD dropped to the lowest level in two weeks as oil fell and a report showed consumer prices rose less last month than forecast, reducing the chance the central bank will raise rates before the second half. Consumer prices rose 1.3 percent in December from a year earlier after gaining 1 percent in the previous month. The median forecast of economists was for a 1.6 percent rise.
Some changes in the Canadian government were made this week. Canadian Prime Minister Stephen Harper shuffled his cabinet to put more focus on the economic recovery. He also made it clear the government would have to restrain the growth of spending. As expected, Harper left Finance Minister Jim Flaherty at his post. He also moved Stockwell Day from the Trade Department to the Treasury Board, where he will be responsible for helping to tame the budget deficit.
On Thursday’s economic calendar look for the Initial Jobless Claims for the week of January 16, Leading Indicators for December, the January Philadelphia Fed Index and Crude Oil Inventories for the week of January 15. Scheduled earnings include Fifth Third Bank, Imation, Goldman Sachs, Legg Mason, PNC Bank, Continental Airlines, Southwest Air, Union Pacific, Xerox, American Express, Capital One, and Google.
Happy Trading,
James Dicks
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