InvestMacro Forex News

By Central Bank News

The Reserve Bank of India [RBI] cut its repo rate by 50 basis points to 8.00% from 8.50% previously, and reverse repo rate to 7.00%, Bank Rate to 9.00% and kept the Cash Reserve Ratio (CRR) at 4.75%.  The RBI said: “Though inflation has moderated in recent months, it remains sticky and above the tolerance level, even as growth has slowed. These trends are occurring in a situation in which concerns over the fiscal deficit, the current account deficit and deteriorating asset quality loom large. The challenge for monetary policy will thus be to maintain its vigil on controlling inflation while being sensitive to risks to growth and other vulnerabilities.”

By MoneyMorning.com.au

April the 4^th 2012 was an important day in Australia’s history.

This was the day 200 US marines arrived in Darwin from Hawaii.

Australia is now officially a pawn in a dangerous geopolitical chess game between the US and China.

This game is moving fast. It was just November when Obama gave his speech to the Australian government, and said:

‘So let there be no doubt: in the Asia-Pacific in the 21st century, the United States of America is all in…’

A few awkward and public tender moments between Obama and Gillard later, Australia had blindly signed up to being America’s Pacific lapdog. And I mean ‘Pacific’ as in ‘Pacific Ocean’; not in the sense ‘peace loving’ – unfortunately.

For years the Pentagon’s mandate had been to fight counter-insurgency in the wake of 9/11. This is changing. With limited, and shrinking, financial resources the Pentagon’s new mandate is to respond to the growth in China’s military strength and domination of the Pacific region.

The Pentagon has got its work cut out. China’s military budget could double in four years.

People often make the comment that China’s budget is peanuts compared to the US military budget. But America’s is forecast to fall at the same time that China’s is rising.

So although China’s budget is just 15% the size of America’s NOW, in four years time it will have grown to be about 40% the size of America’s. That gap is closing. Fast.

And bear in mind, Chinese military pay is a fraction of US military pay. A US$240 billion budget pays for a much bigger Chinese force than an American force.

China’s military might is surging. The US is ‘all in … in the Asia-Pacific of the 21^st century’. And Australia is in the middle of the two like a punter in a bar fight.

We have effectively aligned ourselves with our biggest customer’s biggest adversary.

Nice one, Prime Minister.

So Where Does This Leave You?

Last year the Chinese state-run newspaper, The Global Times, spelt it out:

‘The US is carrying out smart power diplomacy that takes China as its target in Asia. Stopping it is not realistic, but it is equally unrealistic to expect China to stand idly by and indulge Asian countries as they join the US alliance to guard against China one by one. Confronted with such frictions, which has the most resources and means at its disposal? Is an all-out confrontation possible?

These should be the real concerns….China has more resources to oppose the US ambition of dominating the region than US has to fulfil it…As long as China is patient, there will no room for those who choose to depend economically on China while looking to the US to guarantee their security…Any country which chooses to be a pawn in the US chess game will lose the opportunity to benefit from China’s economy…This will surely make US protection less attractive.’

To be clear, Aussie policy makers must work out some way of keeping good with China and the US at the same time. This delicate diplomatic task may be beyond the current government.

Former US Secretary of State, Henry Kissinger, made a diplomatic suggestion. As Peter Leahy wrote in the Australian recently…

‘Kissinger notes the importance of not seeking to confront or contain China. He does not see China’s military build-up as an exceptional problem and emphasises China’s internal troubles. He argues that the challenge for the two nations is to move to a genuine effort at co-operation rather than an assumption of confrontation.’

Kissinger has a knack of nailing the point. This was the same guy who once said ‘He could never trust European politics until there was just one phone number to call.’

But let’s back up a second. The reality is the Chinese are not our only customers.

True, they are the biggest buyer of Australian commodities, but still only take 22% of the value. China is important to our country’s prosperity, but not the be-all-and-end-all.

Take Japan. It buys 16% of our exports. This is eternally overlooked, but provides a stable base line of demand. (Japan has its own problems of course, but that’s another story.)

The rapid rise in exports to India never gets much airplay, but is a story to watch. Indian commodity demand has climbed from 1% to 7% of our business in the last decade. India is plotting a similar path to China’s, and is an international relationship to foster.

The other point is China doesn’t have many options for finding large amounts of commodities such as iron ore and coal elsewhere at short notice. The Chinese need Australia. But even if they could cut us out, we have other potential buyers. In short, we are in a better position than we often realise.

China and Its Neighbours

The rising might of China’s military has another angle to it for resource investors.

If China and the US don’t find a diplomatic answer to their shared quest for dominance of the Asia-Pacific, then countries around the South China Sea, including the Philippines, Indonesia, Malaysia, and Vietnam, may become higher risk to invest in.

These all cluster around the South China Sea, which is known as Asia’s most important flashpoint. For good reason.

The area of the sea is the same size as Western Australia, and more than two billion people live in the countries that surround it. The busiest shipping lanes in the world run through it. It is host to some huge oil and gas fields as well as valuable fisheries. The problem is that China in the north claims most of the sea as its own, drawing its lines well inside areas that its neighbours also claim.

China has a third of its fleet close to the Spratley islands, which contain some of the region’s best oil and gas fields. But Vietnam also claims them. China’s military strength is growing rapidly, and there is a risk that at some point Vietnam will have to watch impotently as China starts drilling.

After China, the most powerful navies in the South China Sea belong to Singapore and Vietnam.

But even if they combined forces against China to try and reclaim the land, it would be suicide.

Don’t Forget Gold

The South China Sea region is gold rich as well. Some of the biggest gold deposits in the world are in the Philippines, Malaysia, Thailand, Vietnam, Indonesia, PNG, Solomon Islands, as well as New Zealand and Fiji. The reason for this is that this region makes up a key part of a geological structure with a great name – The Rim of Fire.

This Rim of Fire was born out of volcanic activity that tore plates apart to form the Pacific Ocean. This process continues today and there are around 400 volcanoes still active along it.

This volcanic activity on the Rim of Fire is the reason Indonesia hosts the immense Porgera gold mine, containing at least 22 million ounces of gold. Or why the Tampakan deposit in the Philippines is host to 19 million ounces of gold. The Rim of Fire is also why Lihir Island off the coast of Papua New Guinea is home to the monster deposit containing 49 million ounces of gold.

In yesterday’s Money Morning you saw China wants to grow its gold reserves. And it is cheaper to do this by acquiring gold mines than buying gold on the market.

So, the risk is that as Chinese military power grows, it abuses its dominance of the South China Sea to take control of the valuable gold assets lying at its doorstep – on the Rim of Fire.

The messages coming out of the Chinese military are quite belligerent. I’m not sure that China will go as far as starting conflicts to gain control. But I do think that as the big bully, China is likely to intimidate its less powerful neighbours into selling stakes of key gold mines at prices that screw existing investors.

Every aspiring empire before it has used military dominance to wrestle control of key commodities.

It’s hard to imagine China won’t now do the same.

Dr. Alex Cowie
Editor, Diggers & Drillers

The Conference of the Year “After America” DVD

Why You MUST Speculate

Disruptive Technology Stocks For Smart Small-Cap Investors

Australia – The Pacific Pawn in USA Versus China

By MoneyMorning.com.au

I didn’t want to write too much about central bankers today. As tempting as it is to discuss liquidity-driven markets and poor economic fundamentals in Europe, I’m starting to sound like a broken record.

What I really wanted to discuss was long-term wealth creation. There are always problems and risks in the market. Our job is to manage those risks. But our whole aim is wealth creation.

Unfortunately, as an Aussie (or Kiwi) investor, you’re on the back foot in this quest. That’s because our market has a lamentable number of options to buy quality, well-run companies. The Aussie share market has very few world-class companies. I’m talking about companies that have enduring competitive advantages…companies that generate high rates of return and compound those returns through reinvesting earnings.

Limited Options to Invest

A big reason for this is that the market is largely made up of resources and financials. Neither are great sectors to be in during a long bear market in credit.

Resources are great during a boom but they’re not the stocks you can just buy and forget about. They are capital intensive and subject to sharp moves in commodity prices.

And many industrial companies feed off the larger resource companies. Australia has many small engineering and contracting firms that are subject to the same vicious cycle as the resource companies.

Banks are inherently risky. For many, a 5 per cent fall in the value of their assets would wipe them out. With the Aussie residential property market finally starting to crack, I think asset values will come under pressure and bank share prices will fall. Bank of Queensland (it announced a write down and capital raising a couple of weeks back) is like the canary in the coal mine for the banking sector…so expect more write downs and capital raisings for our larger banks in the year ahead.

Whether the two-dimensional nature of the market is to blame or not, competition in Australia is not particularly robust. That’s why many companies fail when trying to expand offshore. Australia’s cosy duopolies don’t condition companies well for offshore expansion. And the local market is not large enough to provide years of unending growth for domestically focused companies.

In addition to all this, many companies are poorly managed from a capital management point of view. They raise capital (sell shares) at a low price and buy back shares at a high price. They listen to investment bankers, not shareholders.

This combination of factors makes it very difficult to construct a portfolio you don’t have to worry about. One where you don’t have to constantly monitor and stress about the effectiveness of the companies’ business models.

I’m talking about investing your capital in a collection of businesses – if bought at the right price – that will compound your wealth year after year. And if bought at the right price (that is, cheaply) you’ll stand a much better chance of beating the average market return over the next 5–10 years.

As I pointed out recently to subscribers of Sound Money. Sound Investments, I expect general equities to produce a long-term return of not much more than 5 per cent per annum over the 5–10 years.

However, a large exposure to precious metals could boost returns to around 7 per cent per annum.

Generating a 7 per cent per annum compound return means you could double your capital over the next 10 years.

How?

Let me tell you about the ‘Rule of 72‘

Investing Using The Rule of 72

Pick a number (let’s say 7) and divide 72 by that number. 72 divided by 7 = 10.3. That means if you can earn a compound return of 7 per cent per year, you will double your capital in 10.3 years.

Divide 72 by any number. The result will tell you how many years it will take for your investment to double.

I’m confident that by remaining patient, you will be able to achieve these returns over a longer time frame. I consider investment a marathon, not a sprint. Over time, the tortoise (you) will beat the hare (the index).

When you think about it, the formula for the tortoise to beat the hare is easy. The index represents the average performance of listed companies. There are a lot of poor companies in the index. If you have the patience and conviction to buy above average companies at a price that reflects an adequate risk/reward trade-off, over the long term you should do better than the average.

What companies do I consider ‘better than average’?  Companies with attributes like competitive strength, quality of management and profitability. Unfortunately, very few of these companies meet the most important definition of a good investment – good value. But that can change. In fact it will change. It always does.

Greg Canavan

Editor, Sound Money. Sound Investments.

From the Archives…

The Deep Ocean Frontier For Mining Profits
2012-04-013 – Dr. Alex Cowie

The Turkish Economy: Knocking At The Door
2012-04-12 – Karim Rahemtulla

Inflation and Sovereign Debt – Why The Best Is Yet To Come
2012-04-11 – Nick Hubble

How to Make the Most Out of Small Cap Investing
2012-04-10 – Kris Sayce

Why You MUST Speculate
2012-04-09 – Kris Sayce

How to Invest Using the Rule of 72

By MoneyMorning.com.au

Investors have been in love with the China story and Chinese stocks for more than a decade.

And, there’s a lot to like if you know what you’re doing and where to look. But there’s an even greater opportunity when you look in the places no one else is looking…except for the Chinese.

China faces a labour crisis. It’s not what you think.

They have lots of workers. Some are very skilled, others highly educated. But the ones working in the factories by the millions possess little but what they can do with their hands.

Their wages are not enough to buy the very purses they sew or bicycles they assemble. That is changing, slowly. The change is becoming painful for Chinese factories.

You see, China does not have factories that have huge margins for profit.

The country has succeeded by being the lowest-cost producer in the world, selling its wares at razor-thin margins to quash any competition.

The resulting success has made China a global powerhouse…but it has also resulted in an unintended consequence: inflation.

China is one of the few emerging countries that I have been to where the government offers few subsidies. Take gasoline, for example. It costs over US$5 per gallon for gas today in China.

That’s more than the U.S., and it’s a lot more than India, which subsidizes fuel.

The price for everything is going up for the local population, so now they’re demanding higher wages.

And they’re getting higher wages, which means even lower profits for factories already stressed by a global economic contraction that has end customers unwilling to pay more.

There is a fix. And that fix is going to make you money. It’s where the Chinese are putting their money — lots of it.

Vietnam -The Opportunity Behind a Massive Disconnect

Between 1991 and 1999, the value of Chinese investments in Vietnam, its neighbour to the south, was about US$120 million.

By 2010, that number had ballooned to more than US$3 billion. And if you add the amount pumped in through Hong Kong, the amount more than quadruples to close to $15 billion in projects.

The influx of cash in the early mid-2000s sent Vietnamese stocks soaring.

But as is often the case in emerging markets, when the spending bubble burst as a result of the accompanying high inflation, the market crashed to a tune of more than 70% from its highs to its lows reached early last year.

I was in Vietnam last year, on the ground, doing research in Ho Chi Minh City (formerly Saigon) and Hanoi. It was hopping! I was puzzled. This was an opportunity that could not be passed up.

There was a massive disconnect, and there still is, between what was happening on the ground and what was reflected in stock prices.

Coupled with the fact that China has no choice but to expand production using lower-cost Vietnamese workers, this was an unparalleled emerging market opportunity.

Vietnam is a vibrant country. The majority of the population is under age 45. They take pride in education and putting in a hard day’s work.

The norm there is to work all day and then go to school in the evening for technical courses. The people want to get ahead, and it shows in the buzz on the streets.

The Vietnamese market will recover. Already since my trip the market has performed better than most in the world, up over 20%. It has more to go — much more.

In my book Where in the World Should I Invest? An Insider’s Guide to Making Money Around the Globe, I talk much more about specific investments that all investors, regardless of location, can make in Vietnam.

Up-and-coming markets require a lot of research at the ground level. I’ve been doing that for the better part of 20 years now, and it’s not all rosy.

There are places I would not touch 20 years ago and still won’t invest in today.
Some markets will be emerging forever.

But, there’s a money migration afoot and that cash is heading to Asia, Africa, Latin America and the Middle East.

In some countries growth is five times that of the U.S. or Europe. Growth like that will translate into profits for your portfolio if you know where to look!

Karim Rahemtulla
Contributing Editor, Money Morning

Publisher’s Note: This article originally appeared in Money Morning (USA)

From the Archives…

The Deep Ocean Frontier For Mining Profits
2012-04-013 – Dr. Alex Cowie

The Turkish Economy: Knocking At The Door
2012-04-12 – Karim Rahemtulla

Inflation and Sovereign Debt – Why The Best Is Yet To Come
2012-04-11 – Nick Hubble

How to Make the Most Out of Small Cap Investing
2012-04-10 – Kris Sayce

Why You MUST Speculate
2012-04-09 – Kris Sayce

Vietnam: The Economy Where China is Putting its Money

Source: ForexYard

Monday’s trading saw the 17-nation currency correct its losses as it traded up versus most of its Major currency counterparts including the U.S Dollar. However, new concerns over the economic stability of both Spain and Italy will continue to affect the movements of the single currency.

The single currency momentarily traded below $1.30 versus the U.S Dollar after Spanish government bond yields appreciated due to fresh concerns over the country’s future growth.The last time the Euro traded below the $1.30 level was back in February of this year.

Renewed pressure on Spanish Bonds pushed the 10-year yield above the 6 percent mark for the first time since the beginning of December.

Elsewhere, Italian 10-year bonds appreciated to 5.67 percent,nearing a two-month high.The fresh concerns over the financial stability of both Spain and Italy could have a negative affect on the 17-nation currency.

Tomorrow, Spain looks to sell 12- and 18- month bills, followed by Auctions on Thursday.

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 Central Bank News
Here's today's Central Bank News link list, click through if you missed the previous central bank news link list.  Remember, if you want to submit links for inclusion in the daily link list, just email them through to us or post them in the comments section below.

Source: ForexYard

Over the past few weeks Crude Oil has moved in different directions, showing no clear trend. Since early March, the commodity has dropped in value but has also rallied throughout.

The situation between Iran and the West has dominated the headlines and has played a major role in the direction of crude oil over the weeks.

There are a number of financial reports due for release this week that could affect the movements of crude oil including, the Bank of Canada’s Overnight Rate,U.S Jobless Claims Weekly Update,Philly Fed Manufacturing Index and U.S Natural Gas Storage Weekly Report.

To conclude, if the U.S-related reports provide positive data and indicate signs of growth, it could possibly push up crude oil prices.If some of the Major currency counterparts such as the Euro and the Australian dollar strengthen versus the greenback,there is also a possibility that crude prices will appreciate.

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 (Dublin) – The Swiss National Bank Interim Chairman Thomas Jordan have had a hard time explaining the SNB’s commitment to upholding the 1.20 cap put there by his predecessor Phillip Hildebrand. On his April 10 Zurich press briefing, Jordan said that the fears about the SNB resolve is misplaced and that it was prepared to make unlimited foreign purchases to ensure that the cap is upheld. However, the demand for Swiss assets have increased to a point that investors were willing to get negative yields at a six-month government bills auction last week due to the increasing Spain’s borrowing cost similar to the one that led to the bailout of Ireland, Portugal, and Greece.

Currency strategists are saying that the current risk aversion linked to the euro is the main driving force for the demand of safe haven currencies and the Swiss is the best option for traders. They are citing that the CHF has a high liquidity and is tradable throughout all time zones; further, the economy is resilient hence many traders will want to buy the franc. However, the current pressure on the franc will ease in the coming months as analysts are forecasting the franc to weaken to 1.23 per euro in coming three months.

The franc has so far increased against 14 of the 16 most traded currencies in the first quarter. The gains against the euro have been limited to 0.4 percent but the Swiss currency has advanced by 8.2 percent against the yen and 3.5 against the dollar. The currency has pared its gains against the euro by 0.1 percent to exchange at 1.2027 per euro. The franc was exchanging at 91.95 centimes per dollar which is 2 percent lower than its December level.

Some analysts believe that the franc is overvalued against the euro and they are expecting EUR/CHF pair to trade at 1.35 in a year’s time. Survey data from Societe Generale is showing a decline in confidence on the SNB’s ability to hold the cap beyond June.

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.
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Article by Investment U

In focus this week: Steve Jobs’ lesson for the solar energy industry, U.S. as a LNG exporter, money in mobile phone payers and the SITFA

The first companies in do not always dominate the industry.

That was the message in a Journal article this week about solar energy and the development of the computer mouse.

When solar costs drop to the point they can compete with carbon power generation, demand in the industry will explode.

Xerox it seems invented the mouse, but Steve Jobs and Apple made it a household item, and made the money on it. The earliest computer pioneers, Xerox in this case, are now only also rans.

According to the Journal, the recent carnage in the solar energy industry is following the same pattern as the computer industry.

The 12 biggest solar manufacturers have dropped in total market value from $70 billion to $6.4 billion, and First Solar, one the kings of early development, has dropped from $20 billion to around $2 billion.

Much of the drop has to do with what the Journal calls structural changes in the industry. The caps on carbon emissions didn’t work out and all of the subsidies, both here and abroad, that allowed the industry to reduce production costs, have either dried up or have become much more difficult to come by.

The result is dropping prices for solar panels and a surplus of solar energy production capacity. Currently solar is on line to produce enough panels this year to generate 40gw of power, but the demand sits at 24gw.

The excess has resulted in a drop in panel costs of about 32% since 2007, almost exactly what computer memory has dropped since 1974.

The similarities between development stumbles in the computer and solar energy industries are eerie. Natural gas is also going through a similar over supply situation that has resulted in prices dropping to record lows, as well.

The Good News

When solar costs drop to the point they can compete with carbon power generation, demand in the industry will explode. But only bigger companies that can absorb the cyclical swings between here and there will be around to capitalize on it.

GE is the only name the Journal mentioned, but it is hardly a pure play. The solar energy industry is still in its infancy. Watch for the suppliers to the manufacturers for the best plays. Think disc and memory manufacturers in the 90s.

The U.S. could be the biggest LNG exporter in the world as soon as 2017; that’s five years, if, and this is a big if!

Barron’s reported this week that the U.S. is in line to be the king of LNG if politics don’t get in the way.

Cheniere, symbol LNG, already has deals with the U.K., Spain and India to export LNG, and it this hasn’t even gotten off the ground yet.

Not only is demand for LNG enormous and growing daily, Asia of course would be the biggest buyer, but our gas surplus has prices at around $2 per million BTUs while the equivalent price compared to oil is around $17 per million BTUs.

That means oil is eight times more expensive than natural gas at current market prices! That’s the kind of advantage the U.S. has as an exporter.

Asian markets pay around $15 per million BTUs for LNG and the demand there has grown by 6% to 8% for the past 10 years and it is expected to continue to grow indefinitely.

Here’s where the big if comes in; the Energy Department has put a moratorium on exporting licenses for LNG. Even Obama estimates LNG exports could create two million jobs but the Energy Department wants to make sure this in the best interest of the American people.

Are you kidding me?

Can you imagine if the auto industry and the grain industries were told there was a moratorium on their exports. This is insane.

We finally have the wherewithal to become a driver in the energy game and Washington puts on the brakes.

Fear not, this will come to pass as soon as the thieves in Washington get their share, and that’s all this moratorium is about.

Cheniere by the way was a pick by The Oxford Club’s Dave Fessler at least a year before the big run-up. When this export situation is settled after the election, and it will be, LNG exporters will be the only place to be.

Making Money on Mobile Buyers and Payers

Transactions on mobile phones are estimated to grow 56% a year to $1 trillion by 2015, that’s just three years. But making money on this monster could be a little risky.

Google and Arm Holding, ARMH, are both in the game now but neither is a pure play. One pure play option mentioned in a Barron’s article last week was Monitise, a U.K. software group.

Monitise is a micro, micro cap stock, about a $461-million company. Their revenue is doubling annually and 300 financial groups are running their software and they have six million users out of 300 million mobile banking users worldwide.

This is far from a done deal.

BofA Merrill Lynch estimates if they only capture 1% of the market, and have a similar PE and margin to their competitors, Global payments, GPN, and Wisecard, their stock price could double.

This is a risky play but the industry has virtually no limits at this point and is well worth a second look. At $.54 per share it may be worth a little play.

Finally, the SITFA

This week Nordstrom’s gets the slap in the kisser.

Nordstrom’s, you know where a $79 pair of shoes costs $500, well, it just had a record year; 10.5 billion in sales in 2011.

But despite a record year their executives don’t get the perks we have come to expect from Wall Street.

Most of the executive perks at Nordstrom have come in the form of discounts on purchases at, you guessed it, Nordstrom’s. In fact, of $85,867 in perks last year, $62,000 of it was from the discounts.

That’s pretty tight! A $10-billion year and the perks only total $85,000 and change and most of that is in their own store. I’m sorry, that’s a slap in the face of what must be an excellent executive team.

I wonder how much of the $65,000 in merchandise will show up for sale on eBay?

Article by Investment U

Source: ForexYard

Overall this year, the Bullion market has failed to impress with gold and silver showing more losses then gains over the previous few months. Last week saw the two metals start off well but changed direction towards the end of the week as the U.S dollar gained momentum.

Even though there is a positive correlation between gold and silver, the latter has declined more frequently and on a weekly scale.

The fresh concerns over the future of the Euro-zone and a possibility that the U.S Labor market could be slowing down, were tow major factors that pushed metal prices up in the beginning of last week. In regards to the U.S economy, there are a number of key financial reports due for release this week that could have an impact on the greenback, and consequently, gold and silver.Reports such as Philly Fed, Housing Starts ,Existing home sales and Initial jobless claims are scheduled for this week. If the reports release positive results, its possible that the dollar will strengthen and push the metals in the opposite direction.

Reports in Europe are also due for release this week including staements from the European Central Bank, German ZEW economic sentiment report and German Business Climate Survey expected on Friday.Positive data from the Euro-zone could push bullion prices up, especially if Germany continue to show signs of growth.

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.