FX Briefing - EUR-USD: To exit or not to exit, that is the question
FX Briefing 13
seek to reassure
of exit strategy?
EUR-USD: To exit or not to exit,
that is the question
As far as US monetary policy is concerned, the answer to this
question became fairly clear this
week. The weak labour market data had already prompted
speculation that an exit from the ultra-loose monetary policy was still a long
way off. This week, comments from several US policymakers confirmed this impression, pushing the dollar
down further. EUR-USD rose to 1.5048, thus coming within a whisker of hitting a
new 15-month high, but dropped again later to 1.49. The British pound also lost
ground, after BoE governor Mervyn King had not ruled out additional quantitative
measures. Cable fell by over 2.5 US cents temporarily to 1.6516, but
strengthened again towards the end of the week to almost 1.67.
All the uncertainty about a possible start to an exit
from the expansionary monetary policy, has thus vanished into thin air. Both
Janet Yellen, president of the San Francisco Fed, and Richard Fisher of the
Dallas Fed expressed doubts as to whether the present upswing was sustainable. Given
high unemployment, low wage growth and dependence on government economic
stimulus measures, an expansionary monetary policy would have to be maintained
for some time to come. The Bank of England governor spoke even more bluntly on
the release of the inflation report. As the economic situation remained
fragile, he said, the central bank was keeping an open mind over whether to
implement further measures to boost the economy in addition to the recent expansion
of the asset purchase programme.
Even Bundesbank president Axel Weber, whose thoughts
on possible exit strategies had unsettled market participants the previous week, struck a very
dovish tone this week: although the financial markets had stabilised significantly and most countries
were now out of recession, the recovery was still fragile and it was thus too early for an exit
from expansive monetary and fiscal policy measures.
The fact that the worst is over in the eurozone was
underlined by the economic data. In the third quarter, all countries except Spain posted positive GDP growth rates again. In Germany, GDP actually increased by 0.7%, and the strong
production figures suggest that growth is set to be robust in the coming
quarter too. Italian GDP growth was almost as strong. But growth in France and the Netherlands turned out to be much weaker. In the euro area as a
whole, gross domestic product rose again by 0.4%; the first increase after five
consecutive declines, some of which had been very steep.
In the eurozone, discussions on an exit from
expansionary monetary policy are likely to heat up again in December in the run-up
to the important ECB governing council meeting. According to Bundesbank president Axel Weber, the gradual removal
of support measures hinges on the situation in the financial sector. As the
central bank has acknowledged that things in this field have stabilised
significantly, we are expecting the ECB to at least announce the start of an
exit strategy on 3 December. If it does in fact turn out to be the first major
central bank to do so, this is likely to give the euro an additional boost. In
the coming week, policymakers will have enough opportunity to give some
indication of their future plans. They will all be meeting up at the 12th Euro Finance
Week, where the restructuring of the financial sector will be discussed.
Uwe Angenendt +49 69 718-3648
Grabbe / Klaus NÃ¤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.