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Market Review - 21/02/2009 00:11 GMT
Dollar falls broadly against major currencies on speculation major central banks may intervene to stabilise the financial system
The single currency rallied from 1.2557 to 1.2885 after triggering stops in a thin U.S. session on rumours that the Chairman of eurozone finance ministers Jean-Claude Juncker has proposed that the common eurozone bond should cover the first 40% of the overall eurozone government debt. Juncker said that it has ‘no doubts’ about the cohesion of the region using the euro, while its member countries need to carry out ‘structural reforms’ to improve competitiveness.
European Central Bank President Jean-Claude Trichet said the global credit crisis poses a ‘serious challenge’ to the financial system. ECB is widely expected to lower borrowing costs by 50 basis points from 2% again at its next meeting on March 5. On the data front, Europe’s manufacturing and service industries unexpectedly contracted at a record pace in February. A composite index of both industries fell to a record low of 36.2 versus the expectation of 38.5. Gold jumped to an 11-month high of 1006.20 on Friday as risk averse investors bought the precious metal as a safe-haven.
U.S. President Obama's adviser Volcker said the global economy may be deteriorating even faster than it did during the Great Depression. Volcker said industrial production in most countries was going down faster than the U.S. The greenback fell initially on speculation that U.S. government could nationalize banks, however, the White House said it strongly believed in a privately held bank system later in the day. U.S. currency tumbled against the Japanese yen and Swiss franc from 94.38 to 92.51 and from 1.1884 to 1.1465 respectively.
Next week will see the release of German WPI and U.K. Nationwide house price on Monday; Japan’s CSPI, German Ifo index, German industrial orders, CBI distribution, U.S. house price index on Tuesday; Japan’s trade balance, German GDP deflator, U.K. GDP and U.S. existing home sales on Wednesday; German Gfk index, unemployment rate, eurozone business climate and economic sentiment, U.S. durable goods, jobless claims and new home sales on Thursday; Japan’s manufacturing PMI, Tokyo CPI, industrial production and retail sales, U.K. Gfk survey, Japan’s construction spending and housing starts, eurozone HICP and unemployment, U.S. GDP, PCE, Chicago PMI and University of Michigan survey on Friday.
Dollar falls broadly against major currencies on speculation major central banks may intervene to stabilise the financial system
The single currency rallied from 1.2557 to 1.2885 after triggering stops in a thin U.S. session on rumours that the Chairman of eurozone finance ministers Jean-Claude Juncker has proposed that the common eurozone bond should cover the first 40% of the overall eurozone government debt. Juncker said that it has ‘no doubts’ about the cohesion of the region using the euro, while its member countries need to carry out ‘structural reforms’ to improve competitiveness.
European Central Bank President Jean-Claude Trichet said the global credit crisis poses a ‘serious challenge’ to the financial system. ECB is widely expected to lower borrowing costs by 50 basis points from 2% again at its next meeting on March 5. On the data front, Europe’s manufacturing and service industries unexpectedly contracted at a record pace in February. A composite index of both industries fell to a record low of 36.2 versus the expectation of 38.5. Gold jumped to an 11-month high of 1006.20 on Friday as risk averse investors bought the precious metal as a safe-haven.
U.S. President Obama's adviser Volcker said the global economy may be deteriorating even faster than it did during the Great Depression. Volcker said industrial production in most countries was going down faster than the U.S. The greenback fell initially on speculation that U.S. government could nationalize banks, however, the White House said it strongly believed in a privately held bank system later in the day. U.S. currency tumbled against the Japanese yen and Swiss franc from 94.38 to 92.51 and from 1.1884 to 1.1465 respectively.
Next week will see the release of German WPI and U.K. Nationwide house price on Monday; Japan’s CSPI, German Ifo index, German industrial orders, CBI distribution, U.S. house price index on Tuesday; Japan’s trade balance, German GDP deflator, U.K. GDP and U.S. existing home sales on Wednesday; German Gfk index, unemployment rate, eurozone business climate and economic sentiment, U.S. durable goods, jobless claims and new home sales on Thursday; Japan’s manufacturing PMI, Tokyo CPI, industrial production and retail sales, U.K. Gfk survey, Japan’s construction spending and housing starts, eurozone HICP and unemployment, U.S. GDP, PCE, Chicago PMI and University of Michigan survey on Friday.
