In the broadcast today: Are the JPY and CHF Candidates for Intervention? In the aftermath of the Bank of Japan’s emergency meeting, we focus on the JPY and CHF and explore the potential for currency market intervention by the Bank of Japan and the Swiss National Bank, we analyze the latest trend developments with the USD/JPY and EUR\/CHF currency pairs, we note the renewed weakness of the EUR against the currency majors and ponder the future of the EUR/USD exchange rate, we take a look at the GBP after the revised U.K.
Archive for August, 2010
The recovery that emerging markets (their economies and financial markets) have staged since the lows of 2008 is impressive. In most corners of the financial markets, all of the losses have been erased, and securities/currencies are trading only slightly below there pre-credit crisis levels. Even compared to twelve months ago, in 2009, the performance of emerging market currencies holds up well. In the year-to-date, however, most of these currencies have appreciated only slightly, thanks to a particularly weak month of August.
The MSCI emerging market stock index is currently down 2.5% since the start of the year.
In the broadcast today: Are EUR & USD Entering a New Phase of the Debt Crisis? As equities and risk appetite continue to deteriorate, we examine the early warning signs of what looks like the next phase of the global debt crisis and explore its potential impact on the EUR and the USD, we analyze the latest trend developments with the EUR/USD and GBP\/USD currency pairs, we follow up on the bearish breakout in the USD\/JPY pair as the USD bounces off the new 15-year lows against the JPY, we note the newly-established all-time low for the EUR vs.
The rally in the Pound, which lifted it 10% from trough to peak, appears to be fizzling. The Pound is already down 3% in the last two weeks, and is trending downward. It now stands at a four-week low against the Dollar.
Looking back at the Pound’s two-month rise, it’s not hard to understand why it was unsustainable. You can see from the charts below that there was a strong correlation with the Euro and the S&P 500 over the same period of time. Thi
Japanese Finance Minister Yoshihiko Noda told reporters he would respond appropriately as needed, an expression he has not previously used in his campaign to talk the currency down.
Noda was to meet Prime Minister Naoto Kan and other ministers later. Market investors, however, were skeptical whether intervention alone would do much to encourage a rise that took the JPY to a 15-year peak versus the dollar and a nine-year high against the EUR on Tuesday, battering share prices in turn.
In the broadcast today: USD, EUR, GBP, JPY Quiet before the Storm? In a day light on economic data, we focus on the USD, EUR, GBP and JPY ahead of a sequence of crucial economic reports that could serve as catalysts for significant price moves at the end of the summer, we analyze the latest trend developments with the EUR/USD and GBP\/USD currency pairs, we continue to monitor the USD\/JPY pair which is still stuck in its recent range, we highlight the market’s reaction to the Australian election, the meeting of the Japanese Prime Minister and the Bank of Japan’s Governor, the U.K.
The Canadian Dollar was supposed to be one of the “hot” currencies of 2010. Given that it’s now exactly where it started the year, I think it’s safe to say that this isn’t the case. On the one hand, it would seem that the markets are still confused about how much the CAD should be worth, as Adam recently pointed out. An alternative interpretation is that investors believe the Loonie should trade near parity with the US Dollar; it has hovered just above that mark since breaching it in April.
The Canadian Dollar has benefited from strong fundamentals, especially compared to the US. Inflation
The EUR hovered near a 10-week peak vs the USD on Wednesday, supported by strong U.S. corporate earnings that also boosted global shares. The greenback was on the back foot, slipping against a currency basket and coming under selling pressure against the JPY as Japanese exporters went short on the U.S. currency.
The euro inched in narrow ranges as investors awaited testimony from Federal Reserve Chairman Ben Bernanke later in the day and looked for fresh factors to extend the single currency’s corrective trend.
Pessimists love to point to the surging US National Debt as an indication that the Dollar will one day collapse. And yet, not only has the US Dollar avoided collapse , but is actually holding steady in spite of record-setting budget deficits. That being the case, one has to wonder: As far as the forex markets are concerned, does this debt even matter?
In attempting to answer this question, it makes sense to start by asking whether investors in general care about perennial budget deficits and an-ever increasing national debt. A rudimentary examination suggests that they don’t. T