User Name: Password:      Register - Lost password?

Forex News Blog
Back to The Headlines
Monday January 7, 2008 - 23:00:52 GMT
FXCM - www.dailyfx.com

Share This Story:
| | Email

Forex Research - US Dollar Recovers, but Watch Out for Growing Rate Cut Expectations

 

Monday, 07 January 2008 21:16:39 GMT

Written by Kathy Lien, Chief Currency Strategist

• Will the ECB Raise Interest Rates?
• British Pound Continues to Sell Off, Rate Cut Expectations Edges Higher

US Dollar Recovers, but Watch Out for Growing Rate Cut Expectations

Friday’s exceptionally weak December non-farm payrolls report led to sharp losses in the US dollar. Today the dollar recovered which is not surprising given the extent of the prior sell-off. However just because the dollar has rallied does not mean that fears of a continued slowdown or a US recession have abated. Harvard Economist Martin Feldstein argues that the latest employment report puts the odds of a recession at more than 50 percent. This may explain why rate cut expectations are continuing to rise with the probability that the Federal Reserve will lower interest rates by 50bp on January 30th now at 70 percent compared to 66 percent on Friday and 0 percent a week ago. Oil prices have fallen back towards $95 barrel, which will help to make the Fed’s decision easier. If inflation is not such a pressing issue, the central bank will be able to focus on doing all that is needed to spur growth. We continue to believe that even though a 50bp rate cut is possible, it is too early for the Federal Reserve to make up their mind. If consumer prices and retail sales remain strong, the central bank may opt to cut interest rates less aggressively. If they confirm the overall weakness of the US economy and the growing threat of a recession however, then the Federal Reserve may have no choice but to cut by 50bp. Pending home sales are due for release tomorrow along with consumer credit. Fed Presidents Plosser and Rosengren will also be giving speeches on the economic outlook. We expect the housing market data to continue to remain weak and the Fed’s economic outlook to remain dismal. As a result, unless the data suggests otherwise, we expect further dollar weakness.

Will the ECB Raise Interest Rates?


The European Central Bank will be announcing their monetary policy decision this Thursday. They are not expected to raise interest rates even though their steady growth and strong inflation numbers suggest that they could. Oil prices have been very volatile which will make it difficult for the central bank to decide whether inflationary pressures are here to stay. For the time being, the risk of another run to $100 oil is still strong enough for the ECB to warn that they will do all that it takes to prevent second round effects. Even though the monthly rate of PPI growth was right in line with expectations, the annualized pace of growth accelerated from 4.0 to 4.1 percent. The business climate and economic indices were also stronger than expected. Tomorrow we are expecting Germany factory orders and Eurozone retail sales. The improvement in Germany’s labor market should keep consumer spending healthy. Meanwhile the Swiss franc sold off against all of the major currencies despite steady employment. The seasonally adjusted jobless rate remained unchanged at 2.6 percent, a five year low. There are no further releases from Switzerland this week, but the latest piece of data does support another interest rate hike.

Visit the Euro Currency Room for resources dedicated specifically to the Euro.

British Pound Continues to Sell Off, Rate Cut Expectations Edges Higher


The British pound continues to be one of the weakest currencies in the foreign exchange market. Since the beginning of December, it has fallen over 1000 pips. Even though economists are not looking for the Bank of England to cut interest rates on Thursday, traders have priced in a 40 percent probability of a 25bp rate cut. This means that if rates are left unchanged, the British pound should rally because part of the recent weakness is due to the pricing in of potential easing. Before the BoE rate decision, there are a number of UK economic releases due for release including the BRC retail sales monitor, their shop price index, nationwide consumer confidence and the trade balance.

Visit the British Pound Currency Room for resources dedicated specifically to the Euro.

Australian, New Zealand and Canadian Dollars Diverge

The commodity currencies diverged significantly today with the Australian and New Zealand dollars rising while the Canadian dollar edged lower. New Zealand was the only country to report any economic data and the worse than expected trade balance figures did little to explain the latest move. In fact, the NZDUSD did not rally until the last 2 hours of the US trading session when the Dow edged back into positive territory. This move is completely driven by a recovery in risk appetite because both gold and oil prices are lower. As for USD/CAD, it has broken out to the upside and looks poised for further gains. This dovetails well into our belief that Canadian employment was particularly weak in December; the data is due for release on Friday.

Tell us what you think on the Canadian dollar Forum.

Japanese Yen Crosses Recover Modestly

The Japanese Yen crosses recovered modestly thanks to the end of day rally in the Dow. Both the monetary base and vehicle sales figures were weaker than the prior month. Although it may be tempting to hope that we may be headed for more gains from here on, traders need to be careful because the moves today are unconvincing. Today’s 27 point rally in US stocks hardly erases the 246 point loss on Friday. Tell us what you think what will happen to the Yen crosses in our latest Carry Trade: Buy or Sell poll.

Visit the Japanese Yen Currency Room for resources dedicated specifically to the Euro.

Daily1_1-7

Daily2_1-7


By Kathy Lien, Chief Strategist of DailyFX.com





Contact Kathy Lien about this article at klien@dailyfx.com

 

Forex Trading News

Forex Research

Daily Forex Market News
Forex news reports can be found on the forex research headlines page below. Here you will find real-time forex market news reports provided by respected contributors of currency trading information. Daily forex market news, weekly forex research and monthly forex news features can be found here.

Forex News
Real-time forex market news reports and features providing other currency trading information can be accessed by clicking on any of the headlines below. At the top of the forex blog page you will find the latest forex trading information. Scroll down the page if you are looking for less recent currency trading information. Scroll to the bottom of fx blog headlines and click on the link for past reports on forex. Currency world news reports from previous years can be found on the left sidebar under "FX Archives."



Elevate Your Trading With The Amazing Trader!

The Amazing Trader includes:
  • Actionable trading levels delivered to YOUR charts in real-time.
  • Live trading strategy sessions.
  • Market Updates with Trading Tools.

Register To Test Your Amazing Trader


Trading Ideas for 23 October 2017

Register for the Amazing Trader

1.

Amazing Trader EVENT RISK Calendar:

Tue 24 Oct
All Day flash PMIs
Wed 25 Oct
01:30 AU- CPI
08:00 DE- IFO Survey
08:30 GB- GDP
14:00 CA- BOC Decision
14:30 US- EIA Crude
Thu 26 Oct
11:45 EZ- ECB Decision
12:30 US- Weekly Jobless
14:00 US- Pending Homes Sales
Fri 27 Oct
12:30 US- GDP
14:00 US- final Univ of Michigan

Forex Trading Outlook


Potential Trading Opportunities


  • POTENTIAL PRICE RISK: Medium Tue-- All Day Global flash PMIs. First good look at October economic performances.



  • POTENTIAL PRICE RISK: HIGH Wed-- 01:30 GMT AU- CPI. Top Inflation indicator.

  • POTENTIAL PRICE RISK: HIGH Wed-- 08:00 GMT DE- IFO Survey. Top German indicator.


  • POTENTIAL PRICE RISK: HIGH Wed-- 14:00 GMT CA- BOC Decision. No Policy Change Expected.


  • POTENTIAL PRICE RISK: Medium Wed-- 14:30 GMT US- EIA Crude. Top Weekly WTI Statistic.



John M. Bland, MBA
co-founding Partner, Global-View.com

EXCLUSIVE: Global-View Daily Trading Chart Points Updated

EXCLUSIVE: Global-View Free Forex Database updated




TRADER ADVOCACY ARTICLES

Trader's Advocate Articles..

pic

Retail Forex Brokerage Changing!

Are you looking for your first broker or do you need of a new one? There are more critical things to consider than you might have thought.

We were trading long before there were online brokers. Global-View has been directly involved with the industry since its infancy. We've seen everything and are up-to-data with recent regulatory changes.

Our Best Brokers listing section includes:Forex Broker Reviews, Forex Broker Directory, Forex Broker Comparisons and advice on How to Choose a Forex Broker

If would like guidance, advice, or have any concerns at all ASK US. We are here to help you.

SEE Our Best Brokers List

Currency Trading Tools

  • Live rates, currency news, fx charts. 

  • Research reports and currency forecasts.

  • Foreign Exchange database and history.

  • Weekly economic calendar.

Directory of  Forex trading tools

 
Terms of Use    Disclaimer    Privacy Policy    Contact    Site Map


Forex Forum
Forex Trading Forum
Forex Forum + forex rates
Forex Forum Archives
Forex Forum RSS
Free Registration

Trading Forums
Currency Forum Guide
Forum Directory
Open Forum
Futures Forum
Political Forum
Forex Brokers
Compare Forex Brokers
Forex Broker News
Forex Broker Hotline

Online Forex Trading
Forex Trading Tools
Currency Trading Tools
Forex Database
FX Chart Points
Risk/Carry Trade Chart Points
Economic Calendar
Quicklinks to Economic Data
Currency Futures Swaps
Fibonacci Calculator
Currency Futures Calculator

Forex Education
Forex Learning Center
FX Trading Basics Course
Forex Trading Course
Forex Trading Handbook

Forex Analysis
Forex Forecasts
Interest Rate Forecasts
Central Bank Forecasts

FX Charts and Quotes
Live FX Rates
Live Global Market Quotes
Live Forex Charts
US Dollar Index Chart
Global Chart Gallery
Daily Market Tracker
Forex News
Forex Blog
Forex News
Forex Blog Archives
Forex News RSS
Forex Services
Forex Products
GVI Forex
Free Trials
FX Bookstore
FX Jobs and Careers
Jobs USA
Jobs UK
Jobs Canada

Forex Forum

The Global-View Forex Forum is the hub for currency trading on the web. Founded in 1996, it was the original forex forum and is still the place where forex traders around the globe come 24/7 looking for currency trading ideas, breaking forex news, fx trading rumors, fx flows and more. This is where you can find a full suite of forex trading tools, including a complete fx database, forex chart points, live currency rates, and live fx charts. In addition, there is a forex brokers directory where you can compare forex brokers. There is also a forex brokers hotline where you can ask for help choosing a forex broker that meets your individual fx trading needs. Interact on the same venue to discuss forex trading.

Forex News

The forex forum is where traders come to discuss the forex market. It is one of the few places where forex traders of all levels of experience, from novice to professionals, interact on the same venue to discuss forex trading. There is also the GVI Forex, which is a private subscription service where professional and experienced currency traders meet in a private forex forum. it is like a virtual forex trading room. This is open to forex traders of all levels of experience to view but only experienced currency tradingprofessionals can post.

Currency Trading

Currency trading charts are updated daily using the forex trading ranges posted in the Global-View forex database. You will also find technical indicators on the fx trading charts, e.g. moving averages for currencies such as the EURUSD. This is another forex trading tool provided by Global-View.com.

Forex Brokers

The forex database can be used to access high, low, close daily forex ranges for key currency pairs, such as the EURUSD, USDJPY, USDCHF, GBPUSD, USDCAD, AUD, NZD and major crosses, including EURJPY, EURGBP, EURCHF, GBPJPY, GBPCHF and CHFJPY. Data for these currency trading pairs dating back to January 1, 1999 can be downloaded to an Excel spreadsheet.

Forex Trading

Forex chart points are in a currency trading table that includes; latest fx tradinghigh-low-close range, Bollinger Bands, Fibonacci retracement levels, daily forex pivot points support and resistance levels, average daily forex range, MACD for the different currency trading pairs. You can look on the forex forum for updates when one of the fx trading tools is updated.

FX Trading

Global-View also offers a full fx trading chart gallery that includes fx pairs, such as the EURUSD, commodities, stocks and bonds. In a fx trading world where markets are integrated, the chart gallery is a valuable trading tool. Look for updates on the Forex Forum when the chart gallery is updated.

Forex Blog

Global-View.com also offers a forex blog, where articles of interest for currency trading are posted throughout the day. The forex blog articles come from outside sources, including forex brokers research as well as from the professionals at Global-View.com. This forex blog includes the Daily Forex View, Market Chatter and technical forex blog updates. In additional to its real time forex forum, there are also Member Forums available for more in depth forex trading discussions.

 

WARNING: FOREIGN EXCHANGE TRADING AND INVESTMENT IN DERIVATIVES CAN BE VERY SPECULATIVE AND MAY RESULT IN LOSSES AS WELL AS PROFITS. FOREIGN EXCHANGE AND DERIVATIVES TRADING IS NOT SUITABLE FOR MANY MEMBERS OF THE PUBLIC AND ONLY RISK CAPITAL SHOULD BE APPLIED. THE WEBSITE DOES NOT TAKE INTO ACCOUNT SPECIAL INVESTMENT GOALS, THE FINANCIAL SITUATION OR SPECIFIC REQUIREMENTS OF INDIVIDUAL USERS. YOU SHOULD CAREFULLY CONSIDER YOUR FINANCIAL SITUATION AND CONSULT YOUR FINANCIAL ADVISORS AS TO THE SUITABILITY TO YOUR SITUATION PRIOR TO MAKING ANY INVESTMENT OR ENTERING INTO ANY TRANSACTIONS.

Copyright ©1996-2014 Global-View. All Rights Reserved.
Hosting and Development by Blue 105