BY GCI Fx Research
€
The euro came off vis-à-vis the U.S. dollar today as the single currency tested bids around the US$ 1.3225 level and was capped around the US$ 1.3420 level. U.K. newspaper The Times reported the International Monetary Fund may forecast that banks’ toxic debts could reach US$ 4 trillion globally. European Central Bank member Stark critically said the Group of Twenty’s decision to increase the usage of Special Drawing Rights is like “creating helicopter money for the globe.” The ECB reiterate it is not changing its requirements for countries to start using the euro, contrary to an International Monetary Fund report that calls for changes that would allow Central and Eastern European countries to qualify for euro usage under different terms. A compromise being discussed may allow Central and Eastern European countries’ bonds to be accepted as collateral by the ECB in exchange for euro liquidity. Data released in the eurozone today saw Q4 2008 gross domestic product downwardly revised to -1.6% from the previous reading of -1.5%. A joint survey from Germany’s Ifo and France’s INSEE said the eurozone economy could contract 1.9% q/q in Q1 2009. In U.S. news, Federal Open Market Committee meeting minutes will be released tomorrow. Euro bids are cited around the US$ 1.3100 figure.
¥/ CNY
The yen appreciated vis-à-vis the U.S. dollar today as the greenback tested bids around the ¥99.85 level and was capped around the ¥101.10 level. Bank of Japan’s Policy Board voted unanimously to keep interest rates unchanged at 0.1% so that the efficacy of previous monetary easing measures can be evaluated. The central bank also kept its economic assessment unchanged for the month of April, repeating its statement that the economy “has deteriorated significantly” due to a “worsening in corporate profits and weakening domestic demand.” Dealers are also awaiting details of the government’s proposed US$ 100 billion stimulus package that will be announced on Friday. The Nikkei 225 stock index lost 0.28% to close at ¥8,832.85. U.S. dollar offers are cited around the ¥104.15 level. The euro moved lower vis-à-vis the yen as the single currency tested bids around the ¥132.20 level and was capped around the ¥135.55 level. The British pound moved lower vis-à-vis the yen as sterling tested offers around the ¥145.80 level while the Swiss franc moved lower vis-à-vis the yen and tested offers around the ¥87.05 level. The Chinese yuan depreciated vis-à-vis the U.S. dollar today as the greenback closed at CNY 6.8361 in the over-the-counter market, up from CNY 6.8343.
₤
The British pound came off vis-à-vis the U.S. dollar today as cable tested bids around the US$ 1.4580 level and was capped around the $1.4775 level. Data released in the U.K. saw February manufacturing output decline for the twelfth consecutive month, off 0.9% m/m and 13.8% y/y. Also, February industrial production was off 1% m/m and 12.5% y/y. Cable bids are cited around the US$ 1.4515 level. The euro came off vis-à-vis the British pound as the single currency tested bids around the ₤0.8990 level and was capped around the ₤0.9115 level.
Daily Market Commentary provided by GCI Financial Ltd.
GCI Financial Ltd (”GCI”) is a regulated securities and commodities trading firm, specializing in online Foreign Exchange (”Forex”) brokerage. GCI executes billions of dollars per month in foreign exchange transactions alone. In addition to Forex, GCI is a primary market maker in Contracts for Difference (”CFDs”) on shares, indices and futures, and offers one of the fastest growing online CFD trading services. GCI has over 10,000 clients worldwide, including individual traders, institutions, and money managers. GCI provides an advanced, secure, and comprehensive online trading system. Client funds are insured and held in a separate customer account. In addition, GCI Financial Ltd maintains Net Capital in excess of minimum regulatory requirements.
DISCLAIMER: GCI’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be U.S.ed as investment advice. GCI assumes no responsibility or liability from gains or losses incurred by the information herein contained.
