FXstreet.com

Daily Analysis

7

0

Expectations for Rate Cuts Support The Yen

Mon, Dec 1 2008, 11:54 GMT
by Benny Menashe

Finotec Group Inc.


EUR/USDUSD/JPYGBP/USDUSD/CHF
1.296597.41.5511.2295
Resistance1.28296.651.54251.2235
1.271595.91.53551.22
1.26294.61.49851.193
Support1.25793.551.4841.183
1.24592.51.47051.1765

The Japanese Yen open the week with a strong momentum on expectations of global interest rate cuts. The BOE, ECB, RBA, RBNZ are expected to lower their overnight rates from 0.5% to 1.5%. The sharp drop in inflationary pressures is allowing central bankers to focus on growth. The lowering of the interest rate is eroding the appeal of the carry trade and supporting the strengthening of the Yen. The red colure on Asia Europe and US futures boards is giving further support to the movement of the yen. On the technical point of view the 95 support level was broken downward and traders will look for the October lows of 90.90. The yen was trading around the levels of 94 against the dollar at 10:10 (GMT).

"Currencies where rates are heading down toward zero should continue to suffer, and those that are already close to zero should continue to benefit," said Neil Jones, head of hedge fund sales at Mizuho.
Analysts expect the RBA to cut its benchmark cash rate by 75 basis points to 4.50 percent on Tuesday. But data on Monday showing Australian inflation slowing much faster than earlier thought and manufacturing activity at record lows in November bolstered the case for a steeper cut in rates. The BOE is expected to slash 1% the RBNZ 1.5%, the ECB is expected to lower the rates at 0.5%.

Traders will be eying the US ISM manufacturing PMI at 15:00(GMT) which is expected to show further decline in the economic activity. At 18:45 (GMT) Fed chairman Ben Bernanke will speak at the chamber of commerce, in Austin. Earlier at 13:30 (GMT) Canada will publish the GDP data which is expected to show a slight recovery.

Pie Chart


Today's Economic Events

Time Event Currency Period Previous Forecast Significance Actual
20:00Treasury Sec Paulson SpeaksUSD2
18:45Fed Chairman Bernanke SpeaksUSD4
15:00Construction Spending m/mUSDOct-0.30%-0.90%2
15:00ISM Manufacturing PricesUSDNov37333
13:30GDPCADSep-0.30%0.20%3
9:30Manufacturing PMIGBPNov40.739.8334.4
9:30Net Lending to Individuals m/mGBPNov1.8B2.2B21.3B
9:30Mortgage ApprovalsGBPOct33K32K232K
9:00Manufacturing PMIEURNov41.163.2235.6
7:00Retail Sales m/mEUROct-1.00%0.50%2-1.60%


Finotec  | Global financial trading center, 1 Grivas Digheni and Chrysanthou, 3035 Mylona P.O.B 58007, Limassol
http://www.finotec.com/ | support@finotec.com

Legal disclaimer and risk disclosure

FINOTEC Trading’s Market Commentaries are provided for informational purposes only. The information contained within these reports is gathered from reputable news sources and not intended as investment advice. FINOTEC Trading assumes no responsibility or liability from gains or losses incurred by the information herein.

Related reports

Weekly Market Commentary - Libor and Official Interest rates are at their narrowest by Mizuho Corporate Bank
Fri, Jul 3 2009, 14:33 GMT

London Gold Market Report by BullionVault.com
Fri, Jul 3 2009, 13:24 GMT

European Market Update - Spain June Services PMI: 41.2 v 39.1 prior by TradeTheNews.com
Fri, Jul 3 2009, 12:32 GMT

Daily Market Report - Risk aversion was the main theme of yesterday's trading session by Wachovia
Fri, Jul 3 2009, 12:25 GMT

FX Thoughts for the Day by Kshitij Consultancy Service
Fri, Jul 3 2009, 12:23 GMT

eurusd, gbpusd, usdchf, usdjpy

View All

Related content

European Markets mixed, EUR rises and GBP lower
FXstreet.com | Fri, Jul 3 2009, 14:38 GMT

Forex: EUR/USD rebounds at 1.3980, back above 1.4000
FXstreet.com | Fri, Jul 3 2009, 11:46 GMT

CURRENCIES: Dollar Edges Higher In Thin Trade Ahead Of Holiday
Dow Jones | Fri, Jul 3 2009, 11:46 GMT

Forex: GBP/USD falls further to test 1.6300
FXstreet.com | Fri, Jul 3 2009, 11:20 GMT

2nd UPDATE: UK Service Sector Grows, End Of Recession Nears
Dow Jones | Fri, Jul 3 2009, 10:15 GMT

eurusd, gbpusd, usdchf, usdjpy

View All

Interested in forex trading? forex brokerage firms!


ACM Advanced Currency Markets SA
Contact the broker/FDM
Open a demo account
MG Financial Group
Contact the broker/FDM
Open a demo account
Capital Market Services, L.L.C.
Contact the broker/FDM
Open a demo account
Deutsche Bank
Contact the broker/FDM
Open a demo account
MIG INVESTMENTS SA
Contact the broker/FDM
Open a demo account

GET CASH BACK FOR YOUR TRADES!   Learn more about the Pip Rebate Program

Note: All information on this page is subject to change. The use of this website constitutes acceptance of our user agreement. Please read our privacy policy and legal disclaimer.

Trading foreign exchange on margin carries a high level of risk and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to trade foreign exchange you should carefully consider your investment objectives, level of experience and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading and seek advice from an independent financial advisor if you have any doubts.

Opinions expressed at FXstreet.com are those of the individual authors and do not necessarily represent the opinion of FXstreet.com or its management. FXstreet.com has not verified the accuracy or basis-in-fact of any claim or statement made by any independent author: errors and Omissions may occur.

Any opinions, news, research, analyses, prices or other information contained on this website, by FXstreet.com, its employees, partners or contributors, is provided as general market commentary and does not constitute investment advice. FXstreet.com will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information.

©2009 "FXstreet.com. The Forex Market" All Rights Reserved.