Month: November 2012

By Central Bank News
    The central bank of Poland, which earlier cut its reference rate by 25 basis points to 4.50 percent, said it would cut rates further if there are signs of a protracted economic slowdown and inflation remains under control.
    The National Bank of Poland (NBP) said recent data had confirmed that the Polish economy was slowing and this would restrain wage and inflationary pressures. According to the central bank’s new forecast, inflation should return to its target in coming quarters but might also drop below the bank’s 2.5 percent target in the medium term.
    Growth in Poland’s economy is forecast to remain below potential in coming years, the NBP said, cutting its forecast for 2012 growth to 2.0-2.6 percent, down from July’s forecast of 2.2-3.6 percent.
    In 2013 the forecast calls for Gross Domestic Product growth of 0.5-2.5 percent, down from its previous forecast of 1.0-3.2 percent, and 2014 growth of 1.1-3.5 percent. 
    “In the opinion of the Council, incoming data confirm a considerable economic slowdown in Poland, which contains wage and inflationary pressure,” the central bank said, adding:
     “Should the incoming information confirm a protracted economic slowdown, and should the risk of increase in inflationary pressure remain limited, the Council will further ease monetary policy.”
    Poland’s economy, which expanded by 4.3 percent in 2011, has been slowing sharply in recent months, mainly due to the euro zone’s debt crises and economic contraction. In the second quarter, Poland’s GDP rose by 2.5 percent, down from 3.5 percent in the first quarter and 4.2 percent in the fourth quarter of last year.
    “Economic activity data were worse than expected and reflected further economic slowdown in 2012 Q3,” the NBP said, noting that industrial output and retail sales in real terms declined in September while the fall in construction and assembly output deepened.
    A continued fall in employment, slower wage growth and a gradually rising unemployment rate “point to a lack of wage pressure and likely further weakening in private demand,” the bank added.
    Poland’s inflation rate remained steady at 3.8 percent in September, above the bank’s target, but the NBP said core inflation and producer price growth continued to fall, which confirms that demand pressure is weakening. Household and corporate inflation expectations also declined.
    Under the NBP’s latest forecast, which assumes unchanged interest rates, there is a 50 percent probability of inflation in the range of 3.7-3.9 percent in 2012, then easing to 1.8-3.1 percent in 2013 and 0.7-2.4 percent in 2014.  
    Poland’s inflation rate was 4.2 percent in 2011.

    www.CentralBankNews.info

By Chris Vermeulen, www.TheGoldAndOilGuy.com

By Central Bank News

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By Central Bank News
     The central bank of Poland cut is benchmark reference rate by 25 basis points to 4.50 percent, as expected, with the economy continuing to weaken.
    The National Bank of Poland (NBP), which had raised it rate in May to push back inflation, would explain its decision later today at a press conference.
    The central bank also cut its lombard rate by 25 basis points to 6.0 percent, the deposit rate to 3.0 percent and the rediscount rate to 4.75 percent.
    Poland’s economy has gradually been losing steam this year due to the euro area’s debt crises and recession. Poland’s Gross Domestic Product expanded by 2.5 percent in the second quarter, down from growth of 3.5 percent in the first quarter and 4.2 percent in the fourth quarter.
    The inflation rate remained steady at 3.8 percent in September and last month the NBP said it would cut rates if data confirmed that the economy continued to slow down and there were limited inflationary pressure even if it expects inflation to remain above its 2.5 percent target during the rest of this year.
    Since that meeting, several Polish central bankers, including the governor, have indicated they were favoring a rate cut.

    www.CentralBankNews.info

London Gold Market Report
from Ben Traynor
BullionVault
Wednesday 7 November 2012, 08:00 EST

SPOT PRICES for buying gold fell back to $1720 an ounce Wednesday morning in London, after hitting two-week highs following news of the re-election of Barack Obama as US president.

“Gold is making significant gains on the back of a weak US Dollar,” said this morning’s commodities note from Commerzbank.

Prices for buying silver fell back below $32 an ounce after they touched their highest level in a week.

“Obama’s re-election is likely to boost expectations of continued easing by the Fed,” says Junya Tanase, chief currency strategist at JPMorgan Chase in Tokyo.

“We forecast gold will end the year at $1780 an ounce and peak late in 2013 at around $1890 an ounce,” adds a report from ANZ.

“We think there could be upside risks to these forecast highs, in the event of additional US policy easing or signs of inflation following the liquidity injections of the past four years.”

“Monetary policy will remain loose under Obama,” reckons Michiyoshi Kato, senior vice president of foreign-currency sales at Mizuho Corporate Bank in Tokyo.

“The Dollar will be sold…[but] Dollar selling may not last that long as the US faces the fiscal cliff.”

The so-called fiscal cliff refers to the combination of tax cut expiries and spending cuts currently due at the start of 2013 unless Congress passes legislation to cancel or postpone them.

European stock markets meantime ticked lower this morning, while on the currency markets the US Dollar recovered from earlier losses as the Euro dropped to a two-month low against the Dollar.

Commodities also fell, while US, UK and German government bond prices gained.

Greek politicians are due to vote tonight on a fresh round of austerity measures, in the hope that agreeing to further reforms will secure payment of the next tranche of bailout money. Wednesday saw the second day of a two-day strike called in protest at the proposals, which include wage cuts and tax hikes worth an estimated €13.5 billion.

“If lawmakers vote in favor of the measures,” says Nikos Kioutsoukis, secretary general of private sector union GSEE, “they will have committed the biggest ever political and social crime against the country and the people.”

Elsewhere in Europe, the financial management of the European Union “Is not yet up to standard”, according to Vitor Caldeira, president of the European Court of Auditors, which published its report on last year’s EU budget Tuesday.

British prime minister David Cameron meantime described as “ludicrous” this morning plans to increase the EU budget by 5%.

“They are proposing a completely ludicrous €100 billion increase in the European budget,” Cameron told reporters ahead of talks with German chancellor Angela Merkel.

“I’ll be arguing for a very tough outcome.”

Cameron’s government was defeated in a parliamentary vote last week, as 53 members of his party joined opposition Labour to pass an amendment calling for a real-terms EU budget cut.

Britain and Germany could “torpedo” the EU budget summit on November 22, German magazine Der Spiegel reports, in what it describes as an “unholy alliance”, with Germany also looking to see a reduction in the proposed EU budget increase.

China is set to overtake India as the world’s largest gold buying nation, according to Song Xin, vice president of the country’s largest gold producer China National Gold.

“China’s large increase in gold consumption will have a positive impact to the global gold market,” said Song.

“China’s production is expected to reach 380 tonnes this year, and we will continue to be the world number one gold producer.”

Reports from Asia this morning suggested gold buyers in India took advantage of last week’s wholesale market price drop, ahead of the Dhanteras and Diwali festivals, traditional occasions for buying gold, which will be celebrated on Sunday and Tuesday respectively.

“I think India has bought enough,” one Singapore dealer told newswire Reuters, “unless there’s a sudden last-minute rush.”

“If this Diwali we manage to sell even a small percent of what we sold last Diwali, we shall be very happy,” says Vimal Kumar Goyal, president of the Delhi Bullion and Jewellers Welfare Association.

“Sales have been abysmally low this year…there is an almost 50 percent dip in sales as compared to previous years and the sales never picked up after the strike was called off,” adds Goyal, referring to the three-week strike by Indian gold dealers that started in March after the government increased duty on gold imports and extended a sales tax to unbranded jewelry.

Indian gold demand could fall to 550 tonnes next year – compared to more than 900 tonnes over the whole of 2011 – new Bombay Bullion Association president Mohit Kamboj said Tuesday, adding that any import duty hikes could push demand down further.

Ben Traynor
BullionVault

Gold value calculator   |   Buy gold online at live prices

Editor of Gold News, the analysis and investment research site from world-leading gold ownership service BullionVault, Ben Traynor was formerly editor of the Fleet Street Letter, the UK’s longest-running investment letter. A Cambridge economics graduate, he is a professional writer and editor with a specialist interest in monetary economics. Ben writes and presents BullionVault’s weekly gold market summary on YouTube and can be found on Google+

(c) BullionVault 2012

Please Note: This article is to inform your thinking, not lead it. Only you can decide the best place for your money, and any decision you make will put your money at risk. Information or data included here may have already been overtaken by events – and must be verified elsewhere – should you choose to act on it.

Source: ForexYard

The currency markets were relatively quiet yesterday, as uncertainties regarding the outcome of the US presidential election led to investors holding off on opening big positions. Still, concerns regarding Greece’s economy caused the euro to slip to a fresh two-month low against the USD in early morning trading. Today, trades can expect a significantly more volatile day, as the final results of the US elections combined with a Greek vote on a set of reform packages are set to impact the marketplace. Failure on the part of the Greek parliament to pass the reforms may lead to heavy euro losses.

Economic News

USD – Final Results of US Election set to Impact Markets Today

Nervous investors remained hesitant to open large positions during European trading yesterday, before the final results of the US presidential election were known. As a result, most currency pairs saw little movement throughout the day. Still, the dollar was able to gain just over 20 pips against the JPY during mid-day trading to reach as high as 80.26. The greenback was not as fortunate against the Canadian dollar. The USD/CAD fell as low as 0.9932 during European trading, down some 24 pips.

Today, the final results of the US presidential and congressional elections are forecasted to generate significant market volatility. If it becomes apparent that no clear winner in the election between President Obama and Mitt Romney can be determined, investors may choose to place their funds with safe-haven assets, like the USD and JPY, until a clearer picture presents itself. Additionally, traders will want to pay attention to a Greek parliamentary vote to institute a batch of new reforms needed to unlock a fresh round of bailout funds. Safe-haven currencies could see a boost if Greece fails to institute the reforms.

EUR – All Eyes on Greek Vote Today

Despite a slow trading day yesterday, the euro was able to see moderate gains against its safe-haven currency rivals ahead of a critical vote on austerity measures in the Greek parliament. The EUR/JPY was able to bounce back from a three-week low to reach as high as 102.87, up just over 50 pips during mid-day trading. Against the US dollar, the common currency was able to advance some 47 pips after hitting a two-month low during morning trading to trade as high as 1.2818 in the afternoon session.

Turning to today, all eyes are likely to be on a Greek parliamentary vote regarding a new batch of austerity measures needed to secure a fresh round of bailout funds. The failure to implement the deeply unpopular austerity measures would threaten to plunge Greece significantly deeper into recession. In such a case, analysts are warning that investors could shift their funds to safe-haven assets, which could cause the euro to turn bearish.

Gold – Despite Modest Gains, Gold Remains Near 9-Week Low

Gold spent most of the day yesterday close to a recent 9-week low, as investors, eager to see who would win the US presidential election, remained hesitant to open big positions. Still, the precious metal was able to gain just over $7 an ounce to trade as high as $1692.45. A minor downward correction brought prices back to the $1689 level later in the day.

Today, the results of the US election are likely to drive the direction gold takes throughout the day. Analysts are predicting that a definitive win for President Obama would mean that US interest rates would remain low for the foreseeable future, which may boost the price of gold. Conversely, a win for Mitt Romney may mean that the precious metal could extend its recent bearish trend.

Crude Oil – Crude Sees Minor Gains ahead of US Election Results

The price of crude oil was able to reach as high as $86.50 during European trading yesterday, up close to $1 a barrel. That being said, the commodity could not maintain its gains, as investors remained nervous regarding the outcome of the US presidential election. By the afternoon session, oil dropped back to the $86.00 level.

Today, in addition to the results of the US elections, which are sure to create volatility in oil prices, traders will also want to pay attention to a Greek parliamentary vote on a new round of austerity measures. Should the parliament vote to implement the new measures, which would unlock a new round of bailout funds, risk taking among investors may boost crude prices.

Technical News

EUR/USD

While the Williams Percent Range on the daily chart is in oversold territory, most other long-term technical indicators show this pair range trading. Traders may want to take a wait and see approach at this time, as a clearer picture is likely to present itself in the near future.

GBP/USD

A bearish cross appears to be forming on the weekly chart’s MACD/OsMA, indicating that a downward correction may occur in the coming days. Furthermore, the Williams Percent Range on the same chart is hovering close to overbought territory. Traders will want to keep an eye on these two indicators, as they may soon signal impending bearish movement.

USD/JPY

The daily chart’s Relative Strength Index is currently in overbought territory, indicating that a downward correction could occur in the near future. Furthermore, the Slow Stochastic on the weekly chart appears close to forming a bearish cross. Opening short positions may be the smart choice for this pair.

USD/CHF

The Slow Stochastic on the daily chart is currently forming a bearish cross, indicating that this pair could see a downward correction in the near future. This theory is supported by the Williams Percent Range on the same chart, which has crossed into overbought territory. Going short may be the wise choice for this pair.

The Wild Card

Platinum

A bullish cross appears to be forming on the daily chart’s MACD/OsMA, indicating that an upward correction could occur in the near future. Additionally, the Williams Percent Range on the same chart has crossed into oversold territory. This may be a good time for forex traders to open long positions ahead of possible upward movement.

Forex Market Analysis provided by ForexYard.

© 2006 by FxYard Ltd

Disclaimer: Trading Foreign Exchange carries a high level of risk and may not be suitable for all investors. There is a possibility that you could sustain a loss of all of your investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with Foreign Exchange trading.

By TraderVox.com

Tradervox.com (Dublin) – The loonie has gained against it many of its counterparts as US stocks and raw materials rose. This has boosted the demand for commodity related currencies such as the Canadian dollar. The rise came as the Standard & Poor’s GSCI Index of 24 raw materials rose 2.3 percent. The surge was supported by the Reserve Bank of Australia decision to keep interest rates unchanged. Most investors and analysts have taken this as a sign of emerging stability in global economy.

Talking prior to the US election results, John Doyle, the Director of Markets at Tempus Consulting Inc in Washington, said that regardless of who wins the election, the US economy will outpace most other economies around the world and this will boost the Canadian dollar. He also noted that the failure if the RBA to cut interest rates have boosted the demand for commodity related currencies.

The Canadian dollar advanced together with other commodity related currencies as the Standard & Poor’s 500 Index of shares rose by 0.8 percent. In addition, futures for crude oil advanced by 4.2 percent to $89.22. This is the highest level it has been in two weeks. Crude oil is Canada‘s large export commodity to the US.

According to George Davis, a technical analyst at Royal Bank of Canada in Toronto, the Canadian currency may strengthen to 98.46 cents per US dollar it breaches Friday’s high of 99.21. In a note to clients, Davis noted that the loonie will find support at 99.42, 99.62 and 99.84. Davis also recommended that traders buy dollars on dips and place their stop-loss at 99 on an hourly closing basis.

The Canadian dollar strengthened against the greenback by 0.4 percent to trade at 99.21 cents per US dollar at the close of day yesterday in Toronto. The Canadian dollar had weakened to its weakest level in three months last week.

Disclaimer
Tradervox.com is not giving advice nor is qualified or licensed to provide financial advice. You must seek guidance from your personal advisors before acting on this information. While we try to ensure that all of the information provided on this website is kept up-to-date and accurate we accept no responsibility for any use made of the information provided. Opinions expressed at Tradervox.com are those of the individual authors and do not necessarily represent the opinion of Tradervox.com or its management. 

Article provided by TraderVox.com
Tradervox.com is a Forex News Portal that provides real-time news and analysis relating to the Currency Markets.
News and analysis are produced throughout the day by our in-house staff.
Follow us on twitter: www.twitter.com/tradervox

By TraderVox.com

Tradervox.com (Dublin) – The US dollar declined against the euro for the second day as speculation US will maintain monetary stimulus rose after Barrack Obama, the US President was re-elected for a second term. The greenback fell against almost all of its most traded counterparts as Associated Press projected that Obama will win with at least 303 electoral votes.

The Australian dollar advanced against the greenback as European and Asian stocks rose boosting demand for riskier assets. After Obam’s win, Michiyoshi Kato, Senior Vice President of Forex Sales in Tokyo at Mizuho Corporate Bank Ltd predicted that the monetary policy in the US will continue to hold hence the dollar will weaken further. He however, noted that the dollar will not stay low for long as there investors will start focusing on fiscal cliff.

The fiscal cliff will involve $600 billion in spending cuts and tax increases unless the Congress acts to stop it from taking effect in 2013. The Fed easing would have had tough times in a Romney administration as he had already expressed his opposition to easing.  Romney, who lost the swing states of Virginia, Ohio, New Hampshire, Iowa, Wisconsin, Colorado, and Nevada, had pledged to replace Fed Chairman Ben Bernanke as the Fed Chairman.

According to Junya Tanase, the chief Currency strategist in Tokyo at JPMorgan Chase & Co, the re-election of Obama boosts speculations of continued easing. Tanase added that is easing leads to lower US yields and higher stock prices, the dollar-yen pair will drop. This will complicate matters in Japan where a strong yen has hampered exports.

The US dollar declined against the Australian dollar by 0.3 percent to trade at $1.0470. The Aussie had gained by 0.9 percent against the US currency in the last two days. Euro’s advance against the greenback was tampered as Greece parliament discussed the austerity measures.

Disclaimer
Tradervox.com is not giving advice nor is qualified or licensed to provide financial advice. You must seek guidance from your personal advisors before acting on this information. While we try to ensure that all of the information provided on this website is kept up-to-date and accurate we accept no responsibility for any use made of the information provided. Opinions expressed at Tradervox.com are those of the individual authors and do not necessarily represent the opinion of Tradervox.com or its management. 

Article provided by TraderVox.com
Tradervox.com is a Forex News Portal that provides real-time news and analysis relating to the Currency Markets.
News and analysis are produced throughout the day by our in-house staff.
Follow us on twitter: www.twitter.com/tradervox