Market Review - 09/09/2014 22:54GMT
Euro rebounds from near 14-month low of 1.2860 on short-covering
The single currency extended recent decline and fell to a fresh near 14-month trough of 1.2860 in European morning on Tuesday, however, active short-covering lifted the pair to 1.2908 in New York morning and then jumped to 1.2957 near New York close due partly to retreat in the U.S. stock markets.
The greenback rose to a fresh near 6-year high at 106.39 in European morning and then 106.47 in New York on Tuesday due to dollar's broad-based weakness, however, active profit-taking capped dollar’s upside and price retreated strongly to 106.04 near New York close due to the selloff in New York stock markets. Dow Jones index closed down by 97 points to 17011.
German FinMin Schaeuble said 'economic environment has weakened somewhat due to external factors; Germany must continue its stability policies, anything else wud lead to a new crisis of confidence; German budgets without net new borrowing shud be new norm fm 2015; Germany fulfilling European stability & growth pact obligations by presenting balanced budget by 2015'; Germany has proven stability policies are the best foundation for growth; Mobilising private investment more effective than state spending programmes; ECB is doing what it can but its instruments are all but exhausted; will present joint proposals with his French counterpart at the w/end on how to boost investment; credit crunch in some countries cannot be resolved with more liquidity, need structural reforms; essential for stability of euro that all EU countries do reform homework n not only announce plans.'
Bank of England Governor Mark Carney said in a speech to representatives of trade unions that Britain's first increase in interest rates since the financial crisis is getting closer but the labour market is still in the process of recovering from the financial crisis. Carney said "with many of the conditions for the economy to normalise now met, the point at which interest rates also begin to normalise is getting closer."
The British pound extended Monday's selloff to in Asia on Tuesday, however, cable rebounded to 1.6125 on short-covering after release of upbeat U.K. production. U.K. industrial output came in at 0.5% m/m, 1.7% y/y versus economists' forecast of 0.2% m/m, 1.3% y/y respectively. Price later briefly jumped to 1.6157 after the hawkish comments by BOE's Carney but only fall to a fresh near 10-montn bottom of 1.6065 before rebounding strongly to 1.6126 near New York close on short covering.
Wednesday will see the release of Japan's corp. goods price and machinery orders, Australia's consumer sentiment, Canada's capacity utilization and U.S. wholesale inventories.
Euro rebounds from near 14-month low of 1.2860 on short-covering
The single currency extended recent decline and fell to a fresh near 14-month trough of 1.2860 in European morning on Tuesday, however, active short-covering lifted the pair to 1.2908 in New York morning and then jumped to 1.2957 near New York close due partly to retreat in the U.S. stock markets.
The greenback rose to a fresh near 6-year high at 106.39 in European morning and then 106.47 in New York on Tuesday due to dollar's broad-based weakness, however, active profit-taking capped dollar’s upside and price retreated strongly to 106.04 near New York close due to the selloff in New York stock markets. Dow Jones index closed down by 97 points to 17011.
German FinMin Schaeuble said 'economic environment has weakened somewhat due to external factors; Germany must continue its stability policies, anything else wud lead to a new crisis of confidence; German budgets without net new borrowing shud be new norm fm 2015; Germany fulfilling European stability & growth pact obligations by presenting balanced budget by 2015'; Germany has proven stability policies are the best foundation for growth; Mobilising private investment more effective than state spending programmes; ECB is doing what it can but its instruments are all but exhausted; will present joint proposals with his French counterpart at the w/end on how to boost investment; credit crunch in some countries cannot be resolved with more liquidity, need structural reforms; essential for stability of euro that all EU countries do reform homework n not only announce plans.'
Bank of England Governor Mark Carney said in a speech to representatives of trade unions that Britain's first increase in interest rates since the financial crisis is getting closer but the labour market is still in the process of recovering from the financial crisis. Carney said "with many of the conditions for the economy to normalise now met, the point at which interest rates also begin to normalise is getting closer."
The British pound extended Monday's selloff to in Asia on Tuesday, however, cable rebounded to 1.6125 on short-covering after release of upbeat U.K. production. U.K. industrial output came in at 0.5% m/m, 1.7% y/y versus economists' forecast of 0.2% m/m, 1.3% y/y respectively. Price later briefly jumped to 1.6157 after the hawkish comments by BOE's Carney but only fall to a fresh near 10-montn bottom of 1.6065 before rebounding strongly to 1.6126 near New York close on short covering.
Wednesday will see the release of Japan's corp. goods price and machinery orders, Australia's consumer sentiment, Canada's capacity utilization and U.S. wholesale inventories.
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