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Weekly Analysis

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Forex weekly news and data

Mon, Aug 11 2008, 12:38 GMT
by Benny Menashe

Finotec Group Inc.

This week we will have various economic data realises that will move the market, starting on Monday the 11th we will have the Australian RBA Monetary Policy statement, the UK’s PPI Input and the Canadian Housing Starts. On Tuesday the 12th we will have the UK’s CPI, the Canadian Trade Balance and the U.S’s Trade Balance. On Wednesday the 13th we have Japan’s Prelim GDP, UK’s Claimant Count Change and BOE Inflation Report and the U.S’s Core retail sales/Retail sales. On the Thursday the 14th we will have the EUR’s German Prelim GDP and CPI, the U.S’s Core CPI, Canadian BOC Summer Review and New Zeeland’s Core Retail Sales/Retail Sales. On Friday the 15th we will have the U.S’s TIC Net-Long-Transactions and the Prelim UoM Consumer Sentiment.

European retail sales dropped by the most in at least 13 years in June, the European Union said on Aug. 5. Consumer confidence slid in July by the most since the Sept. 11, 2001, terrorist attacks, the European Commission said July 30. Traders pared bets the ECB will lift rates a second time this year after increasing its main rate by a quarter-point to 4.25 percent last month. The implied yield on the December interest rate futures, an indication of expectations, has retreated 19 basis points from the previous meeting, to 4.96 percent today. ``We do not expect a significant recovery in the euro from current levels,'' Ashley Davies, a currency strategist in Singapore at UBS AG, the world's second-largest foreign-exchange trader, wrote in a research note today. ``Trichet delivered fairly standard comments, which were interpreted in a dovish fashion.''

Japanese foreign-exchange margin trading accounts rose 92 percent in the fiscal year that ended March, exceeding 1 million for the first time, according to Tokyo-based Yano Research Institute Ltd. Japanese individuals had opened 1.23 million accounts at brokerages that lend money for currency bets, almost double the number from a year ago, Yano Research, publisher of an annual report on the business, said in a press release yesterday. Funds in the accounts totaled 696 billion yen ($6.3 billion), up 13.5 percent from a year earlier, the institute said. The increase shows the popularity of currency investment among Japanese individuals, said Koji Fukaya, senior foreign- exchange strategist at the Tokyo unit of Deutsche Bank AG, the world's largest currency trader. ``Margin trading markets are still growing,'' said Fukaya. ``It is contributing to the yen carry trade,'' in which investors borrow Japan's currency and invest in higher-yielding overseas assets.

Today's Economic Events

Published on  Mon, Aug 11 2008, 12:39 GMT