UFXBank Forex News: Growth and Risk Appetite Boost the Euro | Learn Forex | GoLearnForex.com

UFXBank Forex News: Growth and Risk Appetite Boost the Euro

Written by article default Wednesday, 15 June 2011 13:36

USD Dollar (USD) – The dollar weakened in forex trading against most of the major currencies as U.S. Retail Sales fell less than forecast, damping demand for safe haven assets. Retail sales fell by 0.20% vs. -0.30% forecast. Speaking yesterday, Federal Reserve Chairman, Bernanke said that the U.S. debt ceiling shouldn’t be used as a bargaining chip to force budget cuts, and that failing to raise it could cause “severe disruptions” in financial markets. His words lowered the concern about sending the U.S. government into default. The Stock Markets closed positive for the second day as the Dow Jones rose by 1.03% and the NASDAQ gained 1.48% due to better than estimated data on American retail sales and Chinese industrial production. Crude oil rose by 2.70%, closing at $99.40 a barrel as equities rallied. Gold (XAU) rose by 0.60% from a three-week low and closed at $1,526 an ounce. Gold rebounded on speculation that an improving global economy will spur inflation, boosting demand for the precious metal as a hedge. Today, Core CPI m/m is expected to grow by 0.20% as it had previously, TIC Long-Term Purchases are expected to show 45.3B vs. 24.0B previously, and Industrial Production m/m is expected to grow by 0.30% vs. 0.00% previously.

Euro (EUR) – The euro strengthened against the U.S Dollar as a result of growth and risk appetite among investors. The euro-area finance chiefs are still struggling to break a deadlock over how to enroll private investors into the rescue. The pair retreated after being unable to break above its resistance level of 1.4500. Trading above the support level of 1.4380 will keep the momentum positive for the pair, but if the pair breaks below this support level, it might reach 1.4320 again. Overall, EUR/USD traded with a low of 1.4319 and with a high of 1.4694. Today, Industrial Production m/m is expected to decline by -0.10% as it was previously.

EUR/USD – Last: 1.4421

British Pound (GBP) – The Pound strengthened for the second day against the Greenback after a report showed that U.K. inflation held at the fastest pace since October 2008. The trend for the pair is bullish if the pair maintains its support level of 1.6350. Overall, GBP/USD traded with a low of 1.6212 and with a high of 1.6465. Today, the Claimant Count Change is expected to show 7.1K vs. 12.4K previously and BOE Governor King is expected to speak.

GBP/USD - Last: 1.6370

Japanese Yen (JPY) – The dollar strengthened against the yen after the Bank of Japan kept its interest rate at zero to 0.1 percent and left unchanged its 30 trillion yen lending facility and its 10 trillion yen asset-buying program. In addition, a statement read stated that, "Japan’s economy is likely to continue facing downward pressure for the time being, mainly on the production side.” The pair may test its resistance of 80.80 during the day. Today, no economic data is expected.

USD/JPY-Last: 80.40

Canadian dollar (CAD) – The Canadian Dollar strengthened against its U.S. counterpart due to a price jump in oil. The Canadian Dollar rose, as did other currencies of commodity-exporting countries, against its major peers as raw material prices gained. The trend for the pair is still bearish. Today, Manufacturing Sales m/m are expected to fall by -1.70% vs. 1.90% previously.

USD/CAD - Last: 0.9690