currencies strengthen on Australian central bank interest rate hike
cautious about recovery prospects, only sees gradual improvement
discussion on when to start raising interest rates
Dollar under pressure again
The US currency remains under downward pressure. EUR-USD is
now over 1.47 again; USDJPY around 89. The negative impact of last weekâ€™s
disappointing labour market report on the markets was only short-lived. Some commentators were
actually of the opinion that the job
losses were boosting equity markets and weighing on
the dollar, arguing that the weak labour
market is enabling the Fed to continue to maintain its
expansionary monetary policy.
As before, the forex market reacted very sensitively to
suggestions that the dollarâ€™s international standing might be jeopardized. At the beginning of the
week, it was rumoured that oil producers in the Middle East and importers in China and Japan were discussing the possibility of no longer factoring oil transactions in dollars. This
report intensified fears that members of the Gulf Cooperation Council, which are planning to introduce
a common currency in 2010, could loosen their currenciesâ€™ peg to the dollar.
Then, early on Tuesday morning, the Reserve Bank of Australia surprised financial market
players by raising interest rates from 3.00 to 3.25%. Australia is thus the first big advanced economy to increase
interest rates. The RBA said its decision was based on the global economic recovery.
Australia in particular is benefiting from the relatively
strong growth in the Far East. Unemployment had not risen as much as had been
feared, and inflation would not fall as far as had been expected. Furthermore,
the RBA pointed out that the housing market was picking up significantly, financing conditions had improved and
equity markets were firm.
The Australian dollar soared on the RBAâ€™s decision to
hike interest rates so early. AUD-USD
rose more than 4% to over 0.90, the highest level since
August 2008. Together with the Australian dollar, the â€ścommodity currenciesâ€ť â€“
the Canadian dollar, Brazilian real, New Zealand dollar, Norwegian krone and South African rand strengthened
too. A new gold price record gave the rand additional support: during the
course of the week, gold temporarily rose to $1061 per troy ounce.
Australiaâ€™s interest rate step is significant, as it â€śofficiallyâ€ť
heralds (or seems to be heralding) the upward movement in global interest
rates. Up to now, central banks in the industrialised countries had held the common view that, given the macroeconomic
risks, interest rate hikes were not an option. Market participants are now focusing their
attention on which countries will tighten the reins next. The development of interest rate spreads
is becoming more important again.
The ECB is not tipped to raise rates at the moment. The
introductory statement to Thursdayâ€™s
ECB governing meeting only shows a slight improvement to
the assessment of the macroeconomic situation. Up to now, the ECB had been expecting
a â€śvery gradualâ€ť recovery. ECB president Jean-Claude Trichet continued to use
thisphrase on several occasions. Now,
however, the official statement talks merely of a â€śgradual recoveryâ€ť. In September, inflation was seen as â€śremaining
subdued over the policy-relevant horizonâ€ť. Now the ECB is expecting inflation rates
to be â€śmoderately positiveâ€ť. However, the ECB is still expecting the recovery
to â€śremain rather unevenâ€ť. There was also no change in its assessment of low
inflationary pressures over the medium term, based on the development of money
supply and credit growth.
Mr Trichet was rather tight-lipped on the subject of
exchange rates. He more or less repeated what had been said in the G7
statement, i.e. that excessive volatility and disorderly movement in exchange rates
was detrimental. He added that the US authoritiesâ€™ support of a strong dollar
was extremely important. Mr Trichetâ€™s comments were thus somewhat more moderate
than in some press statements after the G20 summit in Pittsburgh and the Ecofin meeting in GĂ¶teborg.
Next week exchange rate movements are likely to depend
to some extent on whether the upbeat mood in equity markets continues as the
reporting season progresses. During the course of the week, the big US banks are publishing their third-quarter earnings, as
well as IT firms. The minutes of the FOMC meeting on 23 September will also be
in the spotlight. The latest comments of Fed representatives (particularly
regional Fed presidents) show that in the US, discussions about the right timing for tightening
monetary policy are underway. Fed Chairman Ben Bernanke said this week that the
Fed would have to raise interest rates at some point, in order to keep inflation
under control. It will be interesting to see whether this was discussed at
length at the Open Market Committee meeting.
Stephan Rieke +49 69 718-4114
Grabbe / Klaus NĂ¤fken
report has been prepared by BHF-BANK Aktiengesellschaft on behalf of itself and
its affiliated companies (together "BHF-BANK Group") solely for the information
of its clients. The information
and opinions in this document are based on sources believed to be reliable and
acting in good faith, but no representation or warranty, express or implied, is
made by any member of the BHF-BANK Group as to their accuracy, completeness or
correctness. Opinions and recommendations are given in good faith but without
legal responsibility and are subject to change without notice. The information
does not constitute advice or personal recommendation, for which the duty of
suitability would be owed, but may facilitate your own investment decision.
Moreover, you should seek your own advice as to the suitability of an
investment matter mentioned herein. Investors are reminded that the price of
securities and the income from them can go down as well as up and that the past
performance of an investment or a market is not necessarily indicative for
future results. This document is for information
purposes only. Descriptions of any company or companies or their securities
mentioned herein are not intended to be complete, and this document is not, and
should not be construed as, an offer to sell or solicitation of any offer to
buy the securities mentioned in it. BHF-BANK Group and its officers and
employees may have a long or short position or engage in transactions in any of
the securities mentioned in this document, or in any related securities. This
publication must not be distributed in the United
rights reserved. Please mention source when quoting from it.
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
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.
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.
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.
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 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.
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 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.
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.
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.