Members login
Forex-Metal Daily Analysis - 21/07/10
Written by article default Wednesday, 21 July 2010 08:51
Expectations for the stress-test results continue to support the euro.
Asian and European trading sessions
Euro: The euro continued its growth on Tuesday morning, since the expectations for the stress-test results supported the investors’ sentiments. The EUR/USD pair showed its maximums in the range of $1,3030. The results of the bank stress tests are expected to restore confidence in the European financial system.
Positive Euro-zone fundamentals were released on Tuesday. In particular, German producer prices increased above the expectations: annualized June increase for 1.7% against the expectations of 1.1%.
British Pound: The GBP/USD rate increased and reached the $1.5310 level, then dropped to the $1.5174 range. The British pound slipped to its minimums during the European trade as the UK major banks Mortgage Approvals increased for 48K in June after the previous month’s growth for 51K and forecasted increase for 52K.
Japanese yen: The USD/JPY pair traded in the range of Y86.70 - Y87.20. The speculations regarding the possible intervention of the Bank of Japan increased.
Australian Dollar: After the released minutes of the RBA last meeting, the Australian dollar rate started to increase. According to the RBA statement, the GDP growth shows a trend rate. The Chinese stock market growth supported the Australian dollar as well.
Canadian Dollar: According to the expectations, the Bank of Canada increased the interest rate to the level of 0.75%. The Canadian dollar increased and strengthened against the US dollar.
Oil: The oil prices grew during the morning trading as the greenback dropped against the major currencies.
Gold: The gold rate was supported by investors’ expectations for the stress-test results and traded around the level of $1182.90 per ounce.
American trading session
US Dollar: The released negative US fundamentals shifted investors’ trading approach during the second part of the day. The US housing starts volume dropped and resulted in a new wave of concerns over the rehabilitation of the world economy. The euro rate decreased and the US dollar started to grow as the risk appetite dropped.