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Market Review - 11/09/2009 20:33 All times in GMT
Dollar extends weekly losses on strong U.S. data
The greenback remained under pressure against its major counterparts on Friday and extended its weekly losses on strong U.S. economic data. University of Michigan consumer sentiment survey index unexpectedly rose to 70.2 fm 65.7 last month, beating the consensus forecast of 67.3, while wholesale inventories decreased for the eleventh month at a rate of 1.4%, more than forecast of 1.0% decrease. Investors were encouraged by these economic figures and continued to buy high-yielding currencies.
Earlier in Asian trading, the rally in Chinese stock markets due to robust data from China helped the Japanese yen to gain strongly vs the dollar and other currencies. In addition, market's expectation of end-of-quarter expatriation of overseas earnings by Japanese exporters further boosted the yen, the pair subsequently rallied to a 7-month high of 90.21 in New York before retreating.
The single currency traded with a firm undertone in Asian and European sessions and reached another fresh 2009 high of 1.4636 after the release of University of Michigan index. Price then retreated briefly due to dollar’s rebound on save-haven buying after CNN reported the U.S. Coast Guard fired on a suspicious boat in the Potomac River in Washington (today is the 8th anniversary of the 9-11 attacks), however, it was later confirmed that was a training exercise.
Similar to euro, cable showed firm bias and rose to as high as 1.6742 in European morning, the highest level since 10th August due to U.S. dollars’ broad-based weakness and better-than-expected PPI data (core PPI in August rose 0.2% monthly and 0.7% yearly), however, price retreated in late U.S. session on long liquidation ahead of weekend. On the commodity currencies, Australian dollar and kiwi advanced to another 2009 high of 0.8677 and 0.7089 respectively in New York afternoon before easing due to a sharp retreat of $2.65 (or 3.7%) in the price of crude oil after failure to penetrate this month's high of $72.90.
Economic data to be released next week include:
Monday – retail sales in New Zealand; capacity utilisation and industrial production in Japan; combined PPI in Switzerland; employment data and industrial production in Eurozone and; capacity utilization in Canada.
Tuesday – RICS house prices, CPI, RPI, DCLG house prices in U.K.; machine tools orders in Japan; industrial production in Switzerland; ZEW index in Germany and Eurozone; Philadelphia Fed survey, retail sales, PPI, business inventories and empire states manufacturing index in U.S.;
Wednesday – Westpac economic index in Australia; retail sales and ZEW index in Switzerland; ILO unemployment rate and claimant count in U.K.; HICP in Eurozone; CPI, current account, real earnings foreign treasury buys, industrial production and capacity utilisation in U.S.;
Thursday – BOJ rate decision, Tankan big manufacturing and all industry index in Japan; retail sales and CBI industrial trend in U.K.; trade balance in Eurozone; CPI in Canada; SNB rate decision in Switzerland; building permits, housing starts, jobless claims and Philadelphia Fed survey in U.S.;
Friday – PPI in Germany; current account in Eurozone; PSNCR in U.K. and; wholesale sales in Canada.
Dollar extends weekly losses on strong U.S. data
The greenback remained under pressure against its major counterparts on Friday and extended its weekly losses on strong U.S. economic data. University of Michigan consumer sentiment survey index unexpectedly rose to 70.2 fm 65.7 last month, beating the consensus forecast of 67.3, while wholesale inventories decreased for the eleventh month at a rate of 1.4%, more than forecast of 1.0% decrease. Investors were encouraged by these economic figures and continued to buy high-yielding currencies.
Earlier in Asian trading, the rally in Chinese stock markets due to robust data from China helped the Japanese yen to gain strongly vs the dollar and other currencies. In addition, market's expectation of end-of-quarter expatriation of overseas earnings by Japanese exporters further boosted the yen, the pair subsequently rallied to a 7-month high of 90.21 in New York before retreating.
The single currency traded with a firm undertone in Asian and European sessions and reached another fresh 2009 high of 1.4636 after the release of University of Michigan index. Price then retreated briefly due to dollar’s rebound on save-haven buying after CNN reported the U.S. Coast Guard fired on a suspicious boat in the Potomac River in Washington (today is the 8th anniversary of the 9-11 attacks), however, it was later confirmed that was a training exercise.
Similar to euro, cable showed firm bias and rose to as high as 1.6742 in European morning, the highest level since 10th August due to U.S. dollars’ broad-based weakness and better-than-expected PPI data (core PPI in August rose 0.2% monthly and 0.7% yearly), however, price retreated in late U.S. session on long liquidation ahead of weekend. On the commodity currencies, Australian dollar and kiwi advanced to another 2009 high of 0.8677 and 0.7089 respectively in New York afternoon before easing due to a sharp retreat of $2.65 (or 3.7%) in the price of crude oil after failure to penetrate this month's high of $72.90.
Economic data to be released next week include:
Monday – retail sales in New Zealand; capacity utilisation and industrial production in Japan; combined PPI in Switzerland; employment data and industrial production in Eurozone and; capacity utilization in Canada.
Tuesday – RICS house prices, CPI, RPI, DCLG house prices in U.K.; machine tools orders in Japan; industrial production in Switzerland; ZEW index in Germany and Eurozone; Philadelphia Fed survey, retail sales, PPI, business inventories and empire states manufacturing index in U.S.;
Wednesday – Westpac economic index in Australia; retail sales and ZEW index in Switzerland; ILO unemployment rate and claimant count in U.K.; HICP in Eurozone; CPI, current account, real earnings foreign treasury buys, industrial production and capacity utilisation in U.S.;
Thursday – BOJ rate decision, Tankan big manufacturing and all industry index in Japan; retail sales and CBI industrial trend in U.K.; trade balance in Eurozone; CPI in Canada; SNB rate decision in Switzerland; building permits, housing starts, jobless claims and Philadelphia Fed survey in U.S.;
Friday – PPI in Germany; current account in Eurozone; PSNCR in U.K. and; wholesale sales in Canada.
