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Daily FX Report
US economy is already in a recession
Fri, Mar 28 2008, 09:53 GMT
by Varengold Bank Research Team
Varengold Wertpapierhandelsbank AG
Good morning from wonderful Hamburg and welcome to Varengold’s Daily FX Report. The conclusion of this exiting trading week is that US economy is already in a recession. A series of weak housing and capital spending data has convinced more investors from the cyclical downturn and supported expectations for a big FED rate cut from the current 2,25 percent.
Markets review
The USD fell back towards record lows against the EUR as rumours controlled the market that Lehman Brothers could suffer a fate similar to the collapse of Bear Stearns hurt sentiment. However Lehman called the rumours totally unfounded. The EUR edged up to 1,5789 from around 1,5770 in late US trade on Thursday.
The USD was also under pressure against the JPY as Japanese exporters and institutional investors repatriated funds before the fiscal year ends on Monday. But many Japanese traders stayed on the sidelines and limited their participation in asset markets before closing their books for the current quarter and business year, making price movements difficult. The USD/JPY was flat at 99,62, staying in sight of a 13-year low of 95,77.
The British consumer confidence fell in March to its lowest level and hit a 15-year low. The GBP/USD dropped down in the early trading session from 2,0080 to 1,9960.
Technical analysis
GBP/JPY
The GBP/JPY trade actual on its lowest level since the end of 2004 and broke the important 200 mark. Since the middle of March the GBP/JPY tries to break it upside which could be a sign for a new trend turn.
EUR/CAD
After breaking the 1,5 mark the EUR/CAD run straight trough the 1,60 level. It trades now at the highest level since mid of 2005 where the high was at 1,70. That looks like more potential in this currency pair.
| Currency | Support 2 | Support 1 | Pivotpoint | Resistance 1 | Resistance 2 |
| EUR / USD | 1,5660 | 1,5722 | 1,5785 | 1,5847 | 1,5910 |
| USD / JPY | 97,84 | 98,74 | 99,45 | 100,35 | 101,06 |
| GBP / USD | 1,9927 | 2,0003 | 2,0098 | 2,0174 | 2,0269 |
| USD / CHF | 0,9830 | 0,9882 | 0,9934 | 0,9986 | 1,0038 |
| AUD / USD | 0,9115 | 0,9152 | 0,9202 | 0,9239 | 0,9289 |
| CAD / USD | 1,0068 | 1,0121 | 1,0177 | 1,0230 | 1,0286 |
| NZD / USD | 0,7961 | 0,7994 | 0,8029 | 0,8062 | 0,8097 |
| EUR / AUD | 1,6949 | 1,7058 | 1,7153 | 1,7262 | 1,7357 |
| EUR / CAD | 1,5873 | 1,5966 | 1,6076 | 1,6169 | 1,6279 |
| EUR / CHF | 1,5607 | 1,5643 | 1,5684 | 1,5720 | 1,5761 |
| EUR / GBP | 0,7763 | 0,7811 | 0,7855 | 0,7903 | 0,7947 |
| EUR / JPY | 154,86 | 156,06 | 157,05 | 158,25 | 159,24 |
| GBP / CHF | 1,9699 | 1,9824 | 1,9957 | 2,0082 | 2,0215 |
| GBP / JPY | 195,88 | 198,01 | 199,87 | 202,00 | 203,86 |
| Date | Time (GMT) | Economic Indicator | Last |
| 28.03.2008 | 09:30 | GB Current account Q4 GBP | -20,04 |
| 28.03.2008 | 10:30 | CH KOF Indicator | 1,65 |
| 28.03.2008 | 12:30 | US Core PCE price index mm | 0,3 |
| 28.03.2008 | 12:30 | US PCE price index yy | 3,7 |
| 28.03.2008 | 12:30 | US Personal income | 0,3 |
| 28.03.2008 | 13:55 | US U Mich 1-yr inflation-F | 3,6 |
| 28.03.2008 | 14:30 | US ECRI weekly annualized | 130,8 |
Published on Fri, Mar 28 2008, 10:08 GMT
Archive
- Trichet said inflation remains his top concern
Published On Fri, May 9 2008, 08:23 GMT - NZD/USD hit hard
Published On Thu, May 8 2008, 09:21 GMT - The British consumer morale falls in April to its lowest since records began four years ago
Published On Wed, May 7 2008, 13:23 GMT - The USD fell on Monday for the first time in three sessions
Published On Tue, May 6 2008, 08:00 GMT - Focus on Europe with ECB and BoE policy meetings
Published On Mon, May 5 2008, 09:08 GMT
Varengold Wertpapierhandelsbank AG
| Große Elbstraße 27, 22767 Hamburg
http://www.varengold.de/ | info@varengold.de
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