http://subs.zinester.com/5381 Weekly commentary and analysis of the global currency market. There is full analysis of US economy and US dollar prospects. [Archives only] en http://archives.zinester.com/5381/99471.html?rss=1 Trade data hurts Sterling - 11-07-06



Sterling weakened to lows near 1.8365 against the dollar on Monday before
pushing back above 1.84 and was holding close to this level on Tuesday as the
dollar retained a firm tone. Sterling was able to maintain a firm stance
against the Euro at close to 0.6920 and strengthened to 0.6910 in early Europe
on Tuesday before weakening after the trade data.



International yield considerations will remain important and the probability of
a tough ECB stance on interest rates will limit the potential for strong
short-term Sterling buying even if the UK currency can secure further limited
... ]]> 99471 Tue, 11 Jul 2006 15:04:04 MSD http://archives.zinester.com/5381/98661.html?rss=1             INVESTICA LTD ^ Understanding Markets

    Daily market newsletter: 4th July 2006

    Underlying Swiss demand

    The Swiss growth trends remain encouraging and the
    National Bank will continue on the path of gradual
    monetary tightening and this will lessen the risk of
    substantial selling pressure on the franc.  Overall,
    the dollar is likely to hit selling pressure around
     1.2350 with near-term support close to 1.22.



... ]]> 98661 Tue, 04 Jul 2006 15:36:22 MSD http://archives.zinester.com/5381/98153.html?rss=1             INVESTICA LTD ^ Understanding Markets

    Daily market newsletter: 29th June 2006

    What to expect from the Fed

    There is little doubt that the FOMC will sanction
    another interest rate increase on Thursday, although
    the dollar will fall sharply if rates are not
    increased.



    There is a possibility that the Fed will decide on a
    0.5% rate increase and will ally this increase with a
... ]]> 98153 Thu, 29 Jun 2006 16:31:25 MSD http://archives.zinester.com/5381/97926.html?rss=1             INVESTICA LTD ^ Understanding Markets

    Daily market newsletter: 27th June 2006

    Tough ECB talk

    ECB officials have continued to take a tough stance on
    monetary policy over the past 24 hours. Belgian central
    bank governor Quaden stated that the ECB could increase
    rates again as early as the first week of August
    teleconference rather than at the regular council
    meeting later in the month.

    European Central Bank governing council member Nicholas
    Garganas was quoted on Tuesday as saying that the bank
... ]]> 97926 Tue, 27 Jun 2006 15:54:18 MSD http://archives.zinester.com/5381/97342.html?rss=1             INVESTICA LTD ^ Understanding Markets

    Daily market newsletter: 22nd June 2006

    Australian volatility to continue

    The Australian dollar weakened to lows near 0.7340
    against the dollar on Wednesday, but recovered in New
    York with gains back to near 0.74 as the US currency
    weakened and gold prices strengthened. The Australian
    dollar pushed to just above 0.74 in local trading on
    Thursday before edging lower again. There was selling
    pressure above the 0.74 level and the US dollar
    recovery also staged a recovery against the Euro.

... ]]> 97342 Thu, 22 Jun 2006 15:18:10 MSD http://archives.zinester.com/5381/97201.html?rss=1             INVESTICA LTD ^ Understanding Markets

    Daily market newsletter: 21st June 2006

    BOE minutes undermine Sterling

    The Bank of England minutes recorded a 7-1 vote for
    unchanged interest rates in June with Walton again
    voting for an immediate 0.25% rate increase. The bank
    was concerned that weaker financial markets could slow
    growth and inflationary pressure, although there were
    considerable uncertainties as to whether the weakness
    in equity markets was the start of a more prolonged
    downward correction or just a temporary feature.

... ]]> 97201 Wed, 21 Jun 2006 15:08:22 MSD http://archives.zinester.com/5381/96944.html?rss=1             INVESTICA LTD ^ Understanding Markets

    Daily market newsletter: 19th June 2006

    Dollar consolidation

    Interest rate expectations will offer short-term dollar
    support with markets looking for further US Fed rate
    increases over the next two months while bond yields
    have also moved higher. Euro gains will continue to be
    restricted by pressure to reduce long speculative
    positions, but there is likely to be strong
    institutional demand close to 1.25 against the dollar.


... ]]> 96944 Mon, 19 Jun 2006 16:44:20 MSD http://archives.zinester.com/5381/96609.html?rss=1             INVESTICA LTD ^ Understanding Markets

    Daily market newsletter: 16th June 2006

    Longer-term dollar pressures.

    The US current account deficit, due for release later
    today, is likely to stay comfortably above US$200bn for
    the first quarter of 2006. As well as the persistent
    trade deficit, there is a high risk that the income
    account will weaken as the stock of US assets held
    overseas continues to increase. The US will, therefore,
    remain dependent on capital inflows to support the
    dollar.

... ]]> 96609 Fri, 16 Jun 2006 15:37:09 MSD http://archives.zinester.com/5381/96495.html?rss=1             INVESTICA LTD ^ Understanding Markets

    Daily market newsletter: 15th June 2006

    US growth concerns start to increase

    The dollar strengthened after the US consumer inflation
    report on Wednesday, but was unable to break resistance
    close to 1.2530 and the US currency then retreated
    sharply towards 1.2650 with rumours of central bank
    Euro buying.

    The headline 0.4% US consumer price increase for May
    was in line with market expectations as energy costs
    rose by 2.4% over the month while the underlying rate
... ]]> 96495 Thu, 15 Jun 2006 14:59:22 MSD http://archives.zinester.com/5381/96384.html?rss=1             INVESTICA LTD ^ Understanding Markets

    Daily market newsletter: 14th June 2006

    Markets braced for US inflation data

    The Tuesday US producer price data recorded a lower
    than expected headline increase of 0.2% for May while
    the underlying rate was slightly above market
    expectations at 0.3%. The core data will certainly
    maintain inflation concerns, but should not intensify
    fears at this stage.

    The consumer inflation data will be watched closely on
    Wednesday with the dollar and the wider financial
... ]]> 96384 Wed, 14 Jun 2006 14:48:11 MSD http://archives.zinester.com/5381/96253.html?rss=1             INVESTICA LTD ^ Understanding Markets

    Daily market newsletter: 13th June 2006

    Inflation expectations dominate Sterling

    Domestic and international interest rate expectations
    will remain very important in the short term. The UK
    data today will maintain inflation fears, but the Bank
    of England is likely to hold rates steady for now and
    expectations of rising global rates will limit
    near-term Sterling buying interest.



... ]]> 96253 Tue, 13 Jun 2006 16:04:06 MSD http://archives.zinester.com/5381/96123.html?rss=1             INVESTICA LTD ^ Understanding Markets

    Daily market newsletter: 12th June 2006

    US data will have crucial influence

    US import prices rose strongly in May by 1.6% and this
    will maintain market fears over rising inflationary
    pressure in the economy. The economic data will be
    watched very closely this week with a particular focus
    on the inflation figures with producer prices on
    Tuesday and consumer prices on Wednesday. The headline
    data will continue to be influenced by high energy
    prices, although monthly price increases should be
    lower than those recorded in April.
... ]]> 96123 Mon, 12 Jun 2006 14:59:04 MSD http://archives.zinester.com/5381/95553.html?rss=1             INVESTICA LTD ^ Understanding Markets

    Daily market newsletter: 7th June 2006

    Tough call for Bank of England

    The Bank of England monthly interest rate meeting will
    start on Wednesday with the decision due to be
    announced on Thursday.

    After the split decision in May, the bank will face
    another tough decision this month. There will be
    further concerns over inflationary pressures,
    especially with energy prices still running at high
    levels, and there is a clear risk that inflation
... ]]> 95553 Wed, 07 Jun 2006 16:10:07 MSD http://archives.zinester.com/5381/95420.html?rss=1             INVESTICA LTD ^ Understanding Markets

    Daily market newsletter: 6th June 2006

    Bernanke still concerned over inflation

    In comments on Monday, Fed Chairman Bernanke stated
    that core inflation was running at the upper end of the
    acceptable range and that the central bank would be
    vigilant over inflation. Bernanke also stated that the
    economy was slowing, but the market?s initial reaction
    was to concentrate on the inflation comments. Futures
    markets pushed the chances of a June interest rate
    increase back to above 70% which, in turn, offered
    near-term dollar support. The US currency, however, is
... ]]> 95420 Tue, 06 Jun 2006 16:53:18 MSD http://archives.zinester.com/5381/94967.html?rss=1             INVESTICA LTD ^ Understanding Markets

    Daily market newsletter: 2nd June 2006

    ECB set to increase interest rates

    The Euro-zone data has been generally firm over the
    week with a rise in the PMI manufacturing index to the
    highest level for six years at 57.0 from 56.7 the
    previous month. Money supply growth continued to
    strengthen in April with an annual increase of 8.8%
    which is above the ECB?s comfort zone, while there was
    a strong increase in household lending, notably in the
    property sector.

... ]]> 94967 Fri, 02 Jun 2006 14:47:12 MSD http://archives.zinester.com/5381/94842.html?rss=1             INVESTICA LTD ^ Understanding Markets

    Daily market newsletter: 1st June 2006

    Dollar trades off rate expectations

    Interest rate considerations will remain important in
    the short term with the dollar looking to gain support
    from increased expectations of a further rate increase
    in June. The decision is, however, still open and a run
    of disappointing data would result in fresh dollar
    selling.

    The dollar found further support close to the 1.29
    level against the Euro on Wednesday and strengthened to
... ]]> 94842 Thu, 01 Jun 2006 15:26:15 MSD http://archives.zinester.com/5381/94629.html?rss=1             INVESTICA LTD ^ Understanding Markets

    Daily market newsletter: 30th May 2006

    US Treasury changes?

    There have been further and persistent reports that US
    Treasury Secretary Snow will resign during June,
    possibly as early as this week. The immediate market
    impact should still be relatively limited, especially
    as there have been persistent rumours of his departure
    over the past few weeks, although his resignation would
    still tend to weaken the dollar. Treasury changes and
    dollar policies will remain important market
    influences.
... ]]> 94629 Tue, 30 May 2006 17:47:12 MSD http://archives.zinester.com/5381/94084.html?rss=1             INVESTICA LTD ^ Understanding Markets

    Daily market newsletter: 25th May 2006

    Dollar consolidation continues

    Trading conditions are liable to remain hesitant and
    volatile in the short term due to continuing
    uncertainty over US economic trends and interest rate
    policy. A set of strong GDP and housing data today
    would offer dollar support, although rallies are likely
    to be met strong institutional Euro demand. Overall,
    the consolidation phase is likely to continue in the
    short term unless the US data is extreme.

... ]]> 94084 Thu, 25 May 2006 14:50:17 MSD http://archives.zinester.com/5381/93981.html?rss=1             INVESTICA LTD ^ Understanding Markets

    Daily market newsletter: 24th May 2006

    US data back in focus

    The flow of US economic data has been limited over the
    past few days, but will resume on Wednesday with
    figures on durable goods orders and new home sales.
    Existing home sales data is due on Thursday together
    with revised GDP data for the first quarter.

    The durable goods data is notoriously volatile on a
    monthly basis, especially with sharp fluctuations in
    the value of transport and defence goods orders, but
... ]]> 93981 Wed, 24 May 2006 15:11:18 MSD http://archives.zinester.com/5381/93728.html?rss=1             INVESTICA LTD ^ Understanding Markets

    Daily market newsletter: 22nd May 2006

    Commodity currencies in focus

    Commodity prices have continued to weaken on Monday and
    there will also be an important short-term impact on
    the currency markets. Gold prices, for example weakened
    to below the US$650 per ounce level on Monday as
    selling continued after the biggest drop last week
    since 1990. Industrial commodity prices have also
    weakened on fears over a slowing global economy,
    although the main trading factor has been the need for
    a correction after recent very strong increase in
... ]]> 93728 Mon, 22 May 2006 15:55:18 MSD