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Market Review - 12/06/2009 22:55 All times in GMT
Dollar rises broadly on short-covering ahead of weekend G8 meeting
The greenback rebounded across the board on Friday on short-covering as investors booked profit in the higher-yielding assets ahead of the G8 meeting in Italy over the weekend.
Earlier in the day, Japanese Finance Minister Kaoru Yosano said the government's confidence in U.S. debt is 'unshakable' and will keep buying the securities. This comments eased the concerns over Asian countries, including China, Japan, India and South Korea that they would diversify their reserves away from the dollars.
In European afternoon session, euro declined further against the greenback after eurozone posted worse-than-expected industrial production figure (-1.9% in April compared to the readings of –1.4% in March) as the data highlighted the weakness in the region. The single currency tumbled to as low as 1.3935 versus the dollar in New York morning after the release of University of Michigan consumer sentiment survey as the data was somehow mixed. Although it rose to 69 from 68.7 in May, it fell short of economists' forecasts of 69.5. However, the euro was able to recover some of its losses versus the U.S. currency ahead of the G8 meeting in the weekend.
Although the British pound also fell to as low as 1.6330 against the greenback after the release of U.S. consumer survey, sterling pared its losses due to short-covering. In addition, hawkish comments from BOE's chief economist Spencer Dale provided support for cable, he said in a monetary policy conference at Norway's central bank in Oslo that BOE was thinking about future exit strategies from stimulus stance and the instruments are raising rates n selling assets.
The dollar continued to trade with a firm undertone after the supportive comments from Japanese Finance Minister Kaoru Yosano and the yen closed at session high at 98.45 versus the greenback.
Data to be released in the coming week include Switzerland PPI, eurozone employment, U.S. Empire state manufacturing data, net long term TIC flows, NAHB housing market index on Monday; Japan BoJ rate decision, Australia RBA board minutes, Switzerland industrial production, U.K. CPI and RPI, German Zew index, eurozone HICP and Zew survey, U.S. housing starts, U.S. PPI, housing starts, capacity utilisation, industrial production on Tuesday, Australia Westpac leading index, Japan machine order, Switzerland industrial production, retail sales, U.K. BoE meeting minutes, ILO unemployment, eurozone trade balance, Canada leading indicators, U.S. CPI and current account on Wednesday; Switzerland SNB rate decision, U.K. retail sales, CBI trade, Canada CPI, U.S. jobless claims, leading indicators, Philadelphia Fed survey on Thursday; Japan BoJ minutes, German PPI, Canada retail sales on Friday.
Dollar rises broadly on short-covering ahead of weekend G8 meeting
The greenback rebounded across the board on Friday on short-covering as investors booked profit in the higher-yielding assets ahead of the G8 meeting in Italy over the weekend.
Earlier in the day, Japanese Finance Minister Kaoru Yosano said the government's confidence in U.S. debt is 'unshakable' and will keep buying the securities. This comments eased the concerns over Asian countries, including China, Japan, India and South Korea that they would diversify their reserves away from the dollars.
In European afternoon session, euro declined further against the greenback after eurozone posted worse-than-expected industrial production figure (-1.9% in April compared to the readings of –1.4% in March) as the data highlighted the weakness in the region. The single currency tumbled to as low as 1.3935 versus the dollar in New York morning after the release of University of Michigan consumer sentiment survey as the data was somehow mixed. Although it rose to 69 from 68.7 in May, it fell short of economists' forecasts of 69.5. However, the euro was able to recover some of its losses versus the U.S. currency ahead of the G8 meeting in the weekend.
Although the British pound also fell to as low as 1.6330 against the greenback after the release of U.S. consumer survey, sterling pared its losses due to short-covering. In addition, hawkish comments from BOE's chief economist Spencer Dale provided support for cable, he said in a monetary policy conference at Norway's central bank in Oslo that BOE was thinking about future exit strategies from stimulus stance and the instruments are raising rates n selling assets.
The dollar continued to trade with a firm undertone after the supportive comments from Japanese Finance Minister Kaoru Yosano and the yen closed at session high at 98.45 versus the greenback.
Data to be released in the coming week include Switzerland PPI, eurozone employment, U.S. Empire state manufacturing data, net long term TIC flows, NAHB housing market index on Monday; Japan BoJ rate decision, Australia RBA board minutes, Switzerland industrial production, U.K. CPI and RPI, German Zew index, eurozone HICP and Zew survey, U.S. housing starts, U.S. PPI, housing starts, capacity utilisation, industrial production on Tuesday, Australia Westpac leading index, Japan machine order, Switzerland industrial production, retail sales, U.K. BoE meeting minutes, ILO unemployment, eurozone trade balance, Canada leading indicators, U.S. CPI and current account on Wednesday; Switzerland SNB rate decision, U.K. retail sales, CBI trade, Canada CPI, U.S. jobless claims, leading indicators, Philadelphia Fed survey on Thursday; Japan BoJ minutes, German PPI, Canada retail sales on Friday.
