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Market Review - 21/11/2007 22:16 GMT
Dollar tumbled to 2-year low against Japanese yen on the selloff in global stock markets
The greenback fell broadly against other major currencies due to the selloff in global stock markets. Euro rose to a fresh record high versus the dollar to 1.4871 whilst the U.S. currency weakened to a two-year low of 108.25 against the Japanese yen on active cross buying in jpy due to risk aversions.
The single currency retreated initially from 1.4856 to 1.4775 versus the dollar on active cross selling in euro especially versus the Japanese yen (eur/jpy tumbled from 163.16 to 160.07) and then rallied to a fresh record high of 1.4871 in late New York as the University of Michigan Surveys of final November consumer index fell to 76.1 (forecast was 75.0), its lowest in two year, from October's final reading of 80.9. However, trading volume in the foreign exchange market is 30 percent less than normal as traders and investors left for the U.S. Thanksgiving holiday on Thursday.
The British pound depreciated from 2.0699 to 2.0527 after release of dovish BOE monetary policy committee meeting minutes despite widely expected 7:2 vote for unchanged rate at 5.75% on Nov 8. Sterling weakened to the lowest level (0.7214 per euro) since 2003 against the euro as investors were anticipating BOE's next move will be a cut in rates (as deputy governor Gieves voted for a cut) as reflected by rise in short sterling futures. However, cable rebounded later in the day to around 2.0675 on short-covering together with the renewed weakness in U.S. currency elsewhere.
Australian dollar and New Zealand dollar tumbled versus the U.S. currency from 0.8955 to 0.8652 and from 0.7670 to 0.7457 respectively as investors continued to unwind carry trades especially versus the Japanese yen. Aussie fell sharply against the yen from 98.38 to 93.76. However, the greenback rebounded versus the Canadian dollar from 0.9776 to 0.9926 after the release of unexpectedly weak Canada's retail sales data which came in at a drop of 0.2% in September instead of the expectation of a rise of 0.1%.
Thursday will see the release of German's GDP, eurozone current account and industrial production.
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Market Review - 21/11/2007 22:16 GMT
Dollar tumbled to 2-year low against Japanese yen on the selloff in global stock markets
The greenback fell broadly against other major currencies due to the selloff in global stock markets. Euro rose to a fresh record high versus the dollar to 1.4871 whilst the U.S. currency weakened to a two-year low of 108.25 against the Japanese yen on active cross buying in jpy due to risk aversions.
The single currency retreated initially from 1.4856 to 1.4775 versus the dollar on active cross selling in euro especially versus the Japanese yen (eur/jpy tumbled from 163.16 to 160.07) and then rallied to a fresh record high of 1.4871 in late New York as the University of Michigan Surveys of final November consumer index fell to 76.1 (forecast was 75.0), its lowest in two year, from October's final reading of 80.9. However, trading volume in the foreign exchange market is 30 percent less than normal as traders and investors left for the U.S. Thanksgiving holiday on Thursday.
The British pound depreciated from 2.0699 to 2.0527 after release of dovish BOE monetary policy committee meeting minutes despite widely expected 7:2 vote for unchanged rate at 5.75% on Nov 8. Sterling weakened to the lowest level (0.7214 per euro) since 2003 against the euro as investors were anticipating BOE's next move will be a cut in rates (as deputy governor Gieves voted for a cut) as reflected by rise in short sterling futures. However, cable rebounded later in the day to around 2.0675 on short-covering together with the renewed weakness in U.S. currency elsewhere.
Australian dollar and New Zealand dollar tumbled versus the U.S. currency from 0.8955 to 0.8652 and from 0.7670 to 0.7457 respectively as investors continued to unwind carry trades especially versus the Japanese yen. Aussie fell sharply against the yen from 98.38 to 93.76. However, the greenback rebounded versus the Canadian dollar from 0.9776 to 0.9926 after the release of unexpectedly weak Canada's retail sales data which came in at a drop of 0.2% in September instead of the expectation of a rise of 0.1%.
Thursday will see the release of German's GDP, eurozone current account and industrial production.
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