Daily FX Report
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Central Bank of Australia fears inflation
Thu, Aug 14 2008, 10:31 GMT
by Varengold Bank Research Team
Varengold Wertpapierhandelsbank AG
Good morning from wonderful Hamburg and welcome to the Varengold Daily FX Report. The former Fed chairman Greenspan expressed expectations that US house prices will begin to stabilize in the first half of next year. He expects a higher demand because of more skilled immigrants.
Market review
The Central Bank of Australia fears inflation and plans to cut interest rates, sending the currency close to 7-month low. The AUD/USD fell to a low of 0.8670 from 0.8700. Top officials from RBA are confident, that inflation will find its way back to its 2-3% target range. According to some dealers in Tokyo, the panic selling of the AUD and the NZD the previous day has calmed down, and there is a better mix of buyers and sellers. Analysts have warned risks of a disorderly decrease in the AUD and the NZD if margin traders are forced to sell into a slide to limit losses. The NZD/JPY increased to 76.45 from a day’s low at 75.95. The BoE said in its quarterly report that they expect inflation will reach 5% before falling back dramatically to below its 2% target within two years. After this statement, the market awaits a massive adjustment in UK interest rates. The GBP/USD decreased 1.5% on the day to 1.8689, posting its worst one-day loss in eight month and marking an 11-year low. The USD rose on Wednesday against a basket of currencies because the greenback benefited from expectations that the economic growth in Europe and Asia may slow more sharply than in the United States. The dollar index rose 0.2% to 76.278 and the USD was up 0.3% against the JPY at 109.51, while the EUR/USD traded little changed at 1.4918.
GBP/AUD
From May to July the GBP/AUD traded in a horizontal trend channel with a resistance at 2.0913 and a support level at 2.0373. After breaking through the resistance, the market touched its old resistance level at 2.1885 from the beginning of April. If the market doesn’t break trough this new resistance, we might expect a comeback to the horizontal trend channel.
CHF/JPY
Since the beginning of June, the CHF/JPY has been trading in a horizontal trend channel with a resistance at 104.75 and a support at 102.53. Over the last few trading days the currency pair broke through the support and stopped its decrease at the next strong level at 100.32. If the currency pair doesn’t break trough the new support, we will expect a recovery phase.
Published on Thu, Aug 14 2008, 10:35 GMT
Archive
- The USD/CAD rose from 1.1496 to 1.1630 at its closing
Published On Fri, Jul 3 2009, 08:26 GMT - The deficit climbed from A$282mln in April to A$556mln in May
Published On Thu, Jul 2 2009, 10:45 GMT - The EUR/GBP has been trading close to a downward trend-line during the last quarter
Published On Wed, Jul 1 2009, 08:54 GMT - The currency pair traded in a bearish environment and triggered thereby its lowest monthly level
Published On Tue, Jun 30 2009, 09:00 GMT - In the middle of June, the currency pair slumped down and fell to 131.43
Published On Mon, Jun 29 2009, 08:54 GMT
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