The Forex Daily Digest - July 7, 2009
As investors continue to search for answers about a potential second half global economic recovery, many are flocking to the USD for refuge and bolstering its strength in the process. As the global stock markets take a beating, the USD has experienced support. The continued muscle for the USD will depend on the upcoming earnings season (which begins tomorrow when Alcoa releases their numbers after the closing bell) to determine whether investor confidence will be supported by the numbers - or not.
The GBP experienced more losses after a report on May manufacturing output and industrial output showed unexpected declines. The GBP found even lower ground today, with the market selling off in advance of the Bank of England meeting which is scheduled for Thursday. EUR/GBP strength and GBP/JPY weakness added to the pound’s misery. News reports out of London say that Prime Minister Brown will warn the G8 meeting this week that the worst of the recession lies ahead.
This is G8 week and President Obama is there to speak his peace. A French official from French President Sarkozy’s office said he believes the group will not talk seriously about foreign exchange issues during their meeting. The official said G8 governments "generally don't discuss foreign exchange matters." But many nations are now extremely concerned about the weakness of the USD against other currencies, especially in Europe, as U.S. products are less expensive on the export market than theirs.
In Tokyo, JP Morgan Chase analysts believe continued dollar weakness against the JPY may be on the horizon. The connection between the USD/JPY and the USD three-month Libor/JPY three-month Libor spread is comparatively strong and has been for the past few years. The current level of spread suggests that there could still be reasonably large USD downside risk against the JPY.
Economic reports on the horizon this week that could affect your Forex trading are Crude Inventories for the week of July 3rd. During the last reporting period, that report showed a loss of 3.66 million barrels. Consumer Credit for May will be released on Wednesday and is anticipated to come in at a negative $8.3 billion. Last month it was at a negative $15.7 billion. Other reports out before the end of the week include Wholesale Inventories, Import and Export Prices, the U.S. Trade Balance and the preliminary report on Consumer Sentiment from the University of Michigan.
PremiereTrade® has a wide range of training classes that will fit what you are looking for to accommodate your lifestyle while developing your personal trading experiences. These training classes supply you with the knowledge that will help you in reaching your financial goals. PremiereTrade® is the leader in training individuals how to trade and invest in today’s Forex markets. Start expanding your opportunities today! Contact PremiereTrade and sign you up for the appropriate education so that you will become a more profitable Forex trader.
Happy Trading,
James Dicks
The GBP experienced more losses after a report on May manufacturing output and industrial output showed unexpected declines. The GBP found even lower ground today, with the market selling off in advance of the Bank of England meeting which is scheduled for Thursday. EUR/GBP strength and GBP/JPY weakness added to the pound’s misery. News reports out of London say that Prime Minister Brown will warn the G8 meeting this week that the worst of the recession lies ahead.
This is G8 week and President Obama is there to speak his peace. A French official from French President Sarkozy’s office said he believes the group will not talk seriously about foreign exchange issues during their meeting. The official said G8 governments "generally don't discuss foreign exchange matters." But many nations are now extremely concerned about the weakness of the USD against other currencies, especially in Europe, as U.S. products are less expensive on the export market than theirs.
In Tokyo, JP Morgan Chase analysts believe continued dollar weakness against the JPY may be on the horizon. The connection between the USD/JPY and the USD three-month Libor/JPY three-month Libor spread is comparatively strong and has been for the past few years. The current level of spread suggests that there could still be reasonably large USD downside risk against the JPY.
Economic reports on the horizon this week that could affect your Forex trading are Crude Inventories for the week of July 3rd. During the last reporting period, that report showed a loss of 3.66 million barrels. Consumer Credit for May will be released on Wednesday and is anticipated to come in at a negative $8.3 billion. Last month it was at a negative $15.7 billion. Other reports out before the end of the week include Wholesale Inventories, Import and Export Prices, the U.S. Trade Balance and the preliminary report on Consumer Sentiment from the University of Michigan.
PremiereTrade® has a wide range of training classes that will fit what you are looking for to accommodate your lifestyle while developing your personal trading experiences. These training classes supply you with the knowledge that will help you in reaching your financial goals. PremiereTrade® is the leader in training individuals how to trade and invest in today’s Forex markets. Start expanding your opportunities today! Contact PremiereTrade and sign you up for the appropriate education so that you will become a more profitable Forex trader.
Happy Trading,
James Dicks
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