Posts Tagged ‘currency trading’

Dollar witnesses a two-week low

Friday, October 9th, 2009

The dollar witnessed a two-week low as compared to the euro as signs the international economy is improving increased demand for the high-yielding material goods. After the employment suddenly boosted in the month of September, the Australia dollar increased to a fourteen-month high.

Phil Burke who is the main dealer of the foreign-exchange, spot trading at JP Morgan Securities at Sydney said that according to the people the tough time is over and it does makes sense. But on the whole the dollar is still in a mid term downtrend. In Tokyo, the dollar decreased $1.4769 per euro at 11:49 a.m. from $1.4690 in New York. Previously, it reached $1.4773 which is the lowest since 24th September.

The euro didn’t changed at 130.17 yen, but the dollar came down from 88.60 yen to 88.21 yen. Yesterday it came down to as low as 88.01 which is the weakest in over eight months. The MSCI Pacific Index of the local shares increased 1.1 percent, and Nikkei 225 Stock Average of Japan added 0.1 percent. The gold also increased to the record high for the third consecutive day. The dollar turned down as the survey of the economists estimated the German industrial production extended 1.7 percent in the month of August following 0.8 percent downfall in the month of July.

Berlin’s Economy Ministry is all prepared to the pass the report today. In a different survey estimate, the production of the factory increased 2.1 percent in the month of August after 9.2 percent downfall in the month of July. The data will be revealed tomorrow in Tokyo. Adam Carr who is a senior economist at ICAP said that the international economy is bouncing back.

The European Central Bank will be holding their chief refinancing rate which is at a record low of one percent, and Bank of England is also keeping their chief rate very low at 0.5 percent. Both the central banks will be having a meeting today. According to the experts, the standard rate of the Federal Reserve will be increasing in the third quarter of 2010. The dollar of Australia increased 1.2 percent to the 90.23 American cents which is the maximum level since the month of August 2008 from yesterday’s 89.11 cents in New York.

According to the statistic agency in Sydney, the number of people employed increased to 40,599 from the previous month of August 2008. The unemployment rate also came down 5.6 percent from 5.7 percent. According to the Finance Ministry of Japan the country’s current-account surplus increased 10.3 percent to 1.170 trillion yen in the month of August from the previous year.

The dollar of New Zealand increased to 74.01 American cents from 73.63 yesterday. Previously it reached 74.20 cents which is the healthiest since the month of July 2008. The Finance Minister of New Zealand Bill English said that he is not at all happy with the currency’s level. The yen traded nearby the maximum level in more than eight months as compared to the dollar on the consideration of BOJ (Bank of Japan) will be faster as compared to the Federal Reserve in extracting the emergency stimulus actions.

On 3rd October, the Governor of Bank of Japan Masaaki Shirakawa said that there is a need for the programs to purchase commercial paper and other commercial bonds has relieved. William Dudley who is the President of New York Fed said that American rate of interest should remain low for quite some time just to make sure a healthy revival.

Hideki Amikura who is the deputy general manager of Nomura Trust & Banking Corp, Tokyo said that it is feasible that Bank of Japan might be faster as compared to Fred in making use of the exit policies. This could probably help in the purchase of the yen.

British pound registered a major rise

Friday, October 9th, 2009

Following the jump in Britain’s home cost, the British pound witnessed an intraday rise of 1.6050. The currency was not able to stabilize as the industrial production all at once fell in the month of August. From the preceding day, the GBP/USD remained the same. The Halifax home prize index rushed 1.6 percent after increasing 0.8 percent in the month of August to surpass the anticipations for the increase of 0.6 percent. While the annualized rate came down 7.4 percent during the three months through the month of September amid prediction of 7.8 percent downfall.

Simultaneously, according to a different report the production all of a sudden plunged 2.5 percent in the month of August after increasing 0.5 percent in the preceding month along with the annual rate of manufacturing dropping 11.3 percent from the preceding year, while the production came down 1.9 percent from the month of July.

With the economic viewpoint remaining in doubt, the slew of mixed data proposes the BoE will maintain a peaceful attitude for the policies of future as the policy makers maintaining the risk for the slow revival. And there are chances for the pound to stay down as the investors scale back anticipations for high rates of interest in the subsequent year.

The euro increased against to greenback continuously for the 3rd day and crossed back over twenty day moving average to reach at 1.4752. In the meantime the council member of ECB Erkki Liikanen said that the central bank will take back their emergency programs when the economic circumstances permits, while Miguel Fernandez Ordonez disagreed preventing the incentive too soon might affect the economic recovery as the chances of uncertainties are major.

In addition to this, Miguel anticipated slow paced revival and expects the price pressure to rise by the year end, but the council member had a peaceful attitude for the upcoming price rise as he anticipates price rise to stay reasonable for quite some time. The central bank is also probably to uphold their ongoing policy on Thursday in order to encourage a sustainable revival.

The American dollar destabilized after The Independent newspaper made a comment that Persian Gulf were in talks with China and Japan in order to move oil price to a bank of assets. This would comprise the Japanese yen and euro while the Australian dollar increased to 0.8885 with the Reserve Bank of Australia shocked the market with a 25bp rake hike at 3.25 percent.