The Forex Daily Digest – August 11, 2009
The USD gained for a third straight day against a basket of currencies yesterday as investors continued to trade on the strong U.S. jobs numbers from last Friday while awaiting the Federal Reserve's statement after its policy meeting later this week. Analysts said extending the USD's latest gains may center on the actions and words of the Fed.
The U.S. sees a large group of economic releases this week, although events will be dominated by Wednesday’s FOMC announcement. We look for the target range for the federal funds rate to remain at 0-0.25% and, based on Fed Chairman Ben Bernanke’s testimony to Congress recently, this policy stance is likely to extend well into next year.
The Bank of England’s August Inflation Report is scheduled to be published on Wednesday. At the press conference, Governor Mervyn King will likely provide more information on last week’s decision to extend the Bank’s program of asset purchases by £50bn, to £175bn. Mr. King has noted that, among other things, a boost from the stock cycle should support the short-term outlook for economic activity.
The head of foreign exchange at Canada’s biggest pension-fund manager said an intervention in the currency market by the Bank of Canada to weaken the nation’s soaring dollar would be successful, following a similar move by the Swiss National Bank. A 12 percent appreciation in the CAD against the USD this year is squeezing exporters’ profits, prompting Finance Minister Jim Flaherty to voice concern over the currency’s “rapid” rise. He said “steps” could be taken to weaken it, but he didn’t elaborate.
There’s an interesting currency story out of the Middle East. The Bank of Israel announced that it will stop its program of daily purchases of $100 million in the foreign-exchange market, which began last July. The new policy will go into effect today. The Bank of Israel said it will continue to act in the market in case of unusual movements in the exchange rate that are inconsistent with underlying economic conditions or in case of "disorderly" conditions in the foreign-exchange market.
Today, U.S. economic reports are scheduled to include the preliminary look at U.S. Productivity for the Second Quarter and the June Wholesale Inventory report.
In U.S. earnings today look for Fossil, Bob Evans Farms, InterContinental Hotels Group, Cree, Learning Tree, Warnaco Group, Western Gas Partners, Pan Am Silver, and China Automotive.
I hope you will consider signing up for a very important webinar happening tonight on JDfn! The topic is “Trading a Consolidating Market.” If you are you having difficulty trading during the current sideways market, we can help! Recently, the Forex Market has been confined to channels. Even during these challenging times, our professional traders have still been able to identify trades and post them in our James Dicks Forex Alerts service. During the month of July, they achieved a total of 1031 PIPs, positive proof that you can certainly trade in a consolidating market. To help you in trading the alerts during the current trend of the market, we invite you to attend a FREE 1-Hour Webinar to discuss the specifics of how we are recognizing trades. It will be held this evening 7 pm to 8 pm (Eastern Time). Learn from the comfort of your own home. To register just go to www.premieretradeforex.com/emails/consolidating/register.asp.
Happy Trading,
James Dicks
The U.S. sees a large group of economic releases this week, although events will be dominated by Wednesday’s FOMC announcement. We look for the target range for the federal funds rate to remain at 0-0.25% and, based on Fed Chairman Ben Bernanke’s testimony to Congress recently, this policy stance is likely to extend well into next year.
The Bank of England’s August Inflation Report is scheduled to be published on Wednesday. At the press conference, Governor Mervyn King will likely provide more information on last week’s decision to extend the Bank’s program of asset purchases by £50bn, to £175bn. Mr. King has noted that, among other things, a boost from the stock cycle should support the short-term outlook for economic activity.
The head of foreign exchange at Canada’s biggest pension-fund manager said an intervention in the currency market by the Bank of Canada to weaken the nation’s soaring dollar would be successful, following a similar move by the Swiss National Bank. A 12 percent appreciation in the CAD against the USD this year is squeezing exporters’ profits, prompting Finance Minister Jim Flaherty to voice concern over the currency’s “rapid” rise. He said “steps” could be taken to weaken it, but he didn’t elaborate.
There’s an interesting currency story out of the Middle East. The Bank of Israel announced that it will stop its program of daily purchases of $100 million in the foreign-exchange market, which began last July. The new policy will go into effect today. The Bank of Israel said it will continue to act in the market in case of unusual movements in the exchange rate that are inconsistent with underlying economic conditions or in case of "disorderly" conditions in the foreign-exchange market.
Today, U.S. economic reports are scheduled to include the preliminary look at U.S. Productivity for the Second Quarter and the June Wholesale Inventory report.
In U.S. earnings today look for Fossil, Bob Evans Farms, InterContinental Hotels Group, Cree, Learning Tree, Warnaco Group, Western Gas Partners, Pan Am Silver, and China Automotive.
I hope you will consider signing up for a very important webinar happening tonight on JDfn! The topic is “Trading a Consolidating Market.” If you are you having difficulty trading during the current sideways market, we can help! Recently, the Forex Market has been confined to channels. Even during these challenging times, our professional traders have still been able to identify trades and post them in our James Dicks Forex Alerts service. During the month of July, they achieved a total of 1031 PIPs, positive proof that you can certainly trade in a consolidating market. To help you in trading the alerts during the current trend of the market, we invite you to attend a FREE 1-Hour Webinar to discuss the specifics of how we are recognizing trades. It will be held this evening 7 pm to 8 pm (Eastern Time). Learn from the comfort of your own home. To register just go to www.premieretradeforex.com/emails/consolidating/register.asp.
Happy Trading,
James Dicks
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