1. This site uses cookies. By continuing to use this site, you are agreeing to our use of cookies. Learn More.

Daily Market Commentary

Discussion in 'Forex Daily News & Outlook' started by gcitrading, Aug 5, 2009.

  1. gcitrading

    gcitrading Contributing Member

    Dec 16, 2008
    Likes Received:
    The euro lost marginal ground vis-à-vis the U.S. dollar today as the single currency tested bids around the US$ 1.4355 level and was capped around the $1.4445 level. Data released in the U.S. today saw July Challenger job cuts off 5.7% y/y, an improvement from the prior -9.0% reading. Also, the July ADP employment report evidenced a 371,000 pullback in private sector payrolls, worse-than-expected but an improvement from the revised 463,000 decline in June. These data may not bode well for Friday’s July non-farm payrolls report that some economists will continue to show a moderation in the labour market’s weakness. Many forecasts are focusing on a job loss total of 275,000 for last month. Other data released today saw the July non-manufacturing composite index print at 46.4, below the prior June reading of 47.0. Some traders expected a better result for the services industry in July. Additionally, it was reported that June factory orders grew 0.4% m/m, better than expected but below the revised May reading of +1.1% m/m. The ex-transportation component was up 2.3%. In eurozone news, the EMU-16 July composite output index – combining both the manufacturing and service sectors – improved to 47.0 from 44.6 in June. These data, however, indicate that output has contracted for a fourteenth consecutive month. The EMU-16 services business activity index improved to a nine-month high of 45.7 in July from 44.7 in June while the PMI manufacturing reading rallied to an eleven-month high of 46.3 in July from 42.6 in June. It was also reported that EMU-16 retail sales were off 0.2% m/m and off 2.4% y/y. Euro bids are cited around the US$ 1.3900 figure.

    The yen appreciated vis-à-vis the U.S. dollar today as the greenback tested bids around the ¥94.60 level and was capped around the ¥95.40 level. The pair lost further ground as the U.S. dollar struggled against higher-yielding currencies. Yesterday, Japanese finance minister Yosano indicated he is not concerned about recent moves higher in long-term interest rates, characterizing them as “marginal.” Economics minister Hayashi yesterday reported it is premature to know whether or not Japan has fallen back into deflation because core price declines are modest. Data released in Japan yesterday saw the July monetary base climb 6.1% y/y. Also, it was reported yesterday that Bank of Japan has purchased ¥38.10 billion of equities from banks as of 31 July as part of its ¥ 1 trillion quantitative easing program that will run through April 2010. The Nikkei 225 stock index lost 1.18% to close at ¥10,252.53. 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 ¥136.20 level and was capped around the ¥137.60 level. The British pound moved higher vis-à-vis the yen as sterling tested offers around the ¥162.45 level while the Swiss franc moved lower vis-à-vis the yen and tested bids around the ¥89.05 level. In Chinese news, the U.S. dollar lost ground vis-à-vis the Chinese yuan as the greenback closed at CNY 6.8279 in the over-the-counter market, down from CNY 6.8315.

Share This Page