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U.S. Forex Market Commentary

Thu, Apr 30 2009, 22:09 GMT
by GCI Financial Team

GCI

EURO

The euro depreciated vis-à-vis the U.S. dollar today as the single currency tested bids around the US$ 1.3190 level and was capped around the US$ 1.3385 level.  Many data were released in the U.S. today. First, March personal income was off 0.3% m/m and up 0.3% y/y. Second, personal consumption expenditures were off 0.2% m/m and off 0.9% y/y while core PCE was up 0.2% m/m and 1.8% y/y.  Third, Q1 employment costs were up 0.3% q/q, the smallest gain since at least 1982, and were up 2.1% y/y.  Fourth, the Chicago ISM Business Barometer rose to 40.1 in April from 31.4 in March and these data suggest the currenbt recession may end by the end of the year.  Fourth, weekly initial jobless claims were off 14,000 to 631,000.  Confidence seems to be increase following yesterday’s largely unchanged statement from the Federal Open Market Committee.  Traders are paying close attention to ongoing talks between the Obama administration and Chrysler.  In eurozone news, EMU-16 March unemployment rose to 8.9% from 8.7% in February and the EMU-16 April flash annualized inflation level printed at a record low of 0.6%.  The German government reported it will likely need a supplementary budget and the German budget deficit is set to rise to €80 billion.  Euro bids are cited around the US$ 1.2765 level.

JPY / CNY

The yen depreciated vis-à-vis the U.S. dollar today as the greenback tested offers around the ¥98.90 level and was supported around the ¥97.15 level.   As expected, Bank of Japan kept official interest rates unchanged and reduced its expectations for economic growth in fiscal year 2009 on account of declining exports.  BoJ also reported it expects international economies to begin recovering in the latter half of the current fiscal year.  The Nikkei 225 yesterday stock index climbed 3.94% to close at ¥8,828.26.  U.S. dollar offers are cited around the ¥104.15 level.  The euro moved higher vis-à-vis the yen as the single currency tested offers around the ¥131.05 level and was supported around the ¥128.90 level.  The British pound moved higher vis-à-vis the yen as sterling tested offers around the ¥146.60 level while the Swiss franc moved higher vis-à-vis the yen and tested offers around the ¥86.80 level. 

Published on  Thu, Apr 30 2009, 22:10 GMT