Thursday February 10, 2005 - 11:09:45 GMT
Share This Story
DailyFX.com - www.dailyfx.com
FOREX: US OPEN MARKET POINTS 02-10-05
Euro and Dollar Square off Before the Trade Balance Data
Predictably tight range in the European session tonight as the pair trades ether side of the 1.2800 figure awaiting the December US Trade Balance release at 13:30 GMT. The market is looking for a small decrease in the deficit to -$57 Billion from -$60 Billion in November. The market also expects November’s deficit to be revised by $1 Billion lower after Canada’s Bureau of Statistics admitted to making an error in calculation last month.
In the grand scheme of things whether the deficit is -$55 Billion or -$60 Billion matters little as either number presents a very bearish view of the US Balance Sheet position. Indeed, Goldman Sach’s Jim Oneil today noted that any change short of reducing the Current Account deficit to 3% of GDP will continue to put pressure on the dollar. At present the Current Account deficit is close to 6% of the GDP.
In the near term however, the market may take solace in the fact that this very negative trend may be stabilizing. If the Trade Balance reports materially lower the pair could easily test the 1.2700 figure in the US Session. The key question however, is will EUR/USD stay at those levels for more than a few hours. With no additional releases tomorrow, the Trade Balance is clearly the marquee event of the week. Yet as more and more speculators position short to the euro, the amplitude of the reaction - should it prove dollar positive - is likely to be truncated as too many dollar bulls chase the same trade. The same Goldman Sachs reported that an internal survey of sell-side FX strategists showed that only 25% were recommending euro long positions. With sentiment numbers like that positive fundamental news may not be of much help to the dollar.
FX Spot Overnight
- EUR trades around 2800 awaiting US Trade data
- JPY hovers around 106 as JPY eco data muted
- GBP holds 8600 focusing on BOE announcement and US Trade
- CHF initially rallies on better than excepted Consumer Confidence data but recedes on euro pullback to 2175
13:00GMT – (08:00 AM EST) GBP BOE announces rates Expected 4.75% Previous 4.75%
- 13:30GMT – (08:30 AM EST) USD Trade Balance Dec Expected -$57.4B Previous -$60.3B
- 13:30GMT – (08:30 AM EST) USD Initial Jobless Claims (Feb 5) Expected 325K Previous 316K
- 15:00GMT – (10:00 AM EST) USD Continuing Claims (Jan 29) Expected 2700K Previous 2696K
- 15:00GMT – (10:00 AM EST) CAD New Housing Price Index m/m Dec Expected 0.3% Previous 0.4%
- 15:00GMT – (10:00 AM EST) CAD Int'l Merchandise Trade Dec Expected C$5.2 Previous C$5.4
- 19:00GMT – (14:00 PM EST) USD Monthly Budget Statement Jan Expected $10.0B Previous -$1.4B
Forex Trading News
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
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."