TradeTheNews.com European Market Update: China PBoC raises reserve requirement ratio (RRR) by 50bps ahead of its key inflation report
Friday, December 10, 2010
TradeTheNews.com European Market Update: China PBoC raises reserve requirement ratio (RRR) by 50bps ahead of its key inflation report
***Economic Data*** - (CH) China PBoC raises Reserve Requirement Ratio (RRR) by 50bps; Effective Dec 20th (6th hike this year) - (CH) China Nov New Yuan Loans (CNY): 564B v 500Be (3-month low) - (IN) India Oct Industrial Production Y/Y: 10.8% v 8.5%e - (FI) Finland Oct Industrial Production M/M: 1.5% v 1.3% prior; Y/Y: 11.3% v 8.8% prior - (FI) Finland Oct Preliminary Trade Balance: â‚¬1.3B v -â‚¬140M prior - (GE) Germany Nov Wholesale Prices M/M: 0.7% v -0.3% prior; Y/Y: 7.8% v 7.7% prior - (FR) France Oct Industrial Production M/M: -0.8% v +0.3%e; Y/Y: 4.7% v 5.3%e - (FR) France Oct Manufacturing Production M/M: -0.8% v +0.4%e; Y/Y: 4.5% v 5.2%e - (HU) Hungary Nov Consumer Prices M/M: 0.3% v 0.2%e; Y/Y: 4.2% v 4.2%e - (TU) Turkey Q3 GDP Q/Q: 1.1% v 3.7% prior; Y/Y: 5.5% v 6.5%e; GDP wda Y/Y: 6.4% v 10.2% prior - (DE) Denmark Nov CPI M/M: 0.1% v 0.1%e; Y/Y: 2.6% v 2.6%e - (DE) Denmark Nov CPI EU Harmonized M/M: 0.1% v 0.0%e; Y/Y: 2.5% v 2.4%e - (NV) Netherlands Oct Industrial Production M/M: 0.4% v 0.9%e; Y/Y: 5.1% v 4.9%e; Industrial Sales: 11.1% v 10.6% prior - (SW) Sweden Oct Industrial Production M/M: 0.2% v 1.0%e; Y/Y: 11.3% v 12.8%e - (SW) Sweden Oct Industrial Orders M/M: 3.0% v 5.6% prior; Y/Y: 11.4% v 13.7% prior - (IT) Italy Oct Industrial Production M/M: -0.1% v 0.7%e; Y/Y: -0.2% v 4.6%e; Industrial Production wda Y/Y: 2.9% v 4.5%e - (NO) Norway Nov CPI M/M: 0.2% v 0.2%e; Y/Y: 1.9% v 1.9%e - (NO) Norway Nov CPI Underlying M/M: 0.1% v 0.1%e; Y/Y: 1.0% v 1.0%e - (NO) Norway Nov Producer Prices (incl Oil) M/M: 3.5% v 0.0% prior; Y/Y: 17.9% v 18.0% prior - (UK) Nov PPI Output M/M: 0.3% v 0.3%e; Y/Y: 3.9% v 4.0%e - (UK) Nov PPI Output Core M/M: 0.2% v 0.3%e; Y/Y: 3.3% v 3.5%e - (GR) Greece Nov YTD Cash Balance: -â‚¬21.4B v -â‚¬27.5B y/y - (GR) Greece Oct Industrial Production Y/Y: -4.2% v -7.1% prior - (IT) Italy Q3 Final GDP Q/Q: 0.3% v 0.2%e; Y/Y: 1.1% v 1.0%e
Fixed Income: - (IT) Italy Debt Agency (Tesoro) sells â‚¬4.0B in 12-month Bills; avg yield 2.014% v 1.778% prior; Bid-to-cover: 2.0x v 2.1x prior
Eurostoxx50 2843.52 at +0.10%, FTSE 5813 at +0.08%, CAC 3868 at +0.24%, DAX 7009 at +0.60%
- European stocks fluctuated during session but failed to secure solid gains. The upside was supported by Wall Street gains at the close yesterday but banks continue to weigh in the markets. Investors remain cautious of the Euro zone concerns which, to some analysts, are now overdone. The main worry remains China's imminent interest rate hike which seems even more plausible now given strong exports data. As a first step, China announced another hike in its reserve requirement rate (RRR) by 50 bps in the European session which had a minimal impact on the equities. However, this lending restriction put the brakes on the rally and investors' risk appetite. The investors will be eyeing the key inflationary data out of China which will be published on Saturday, but markets find it increasingly difficult for China to justify its interest rate level with its inflationary expectations rising rapidly. - The financials' decline was led by Standard Chartered after the bank was downgraded by Tier-1 firm following its unsatisfactory trading update on Thursday. UK insurer Prudential [PRU.UK] moved up by 1% after UBS added the firm to its Key Calls list. However the gains were not enough to offset the losses from Prudential and the FTSE100 is trading flat. Meanwhile, Rolls Royce fell about 2% and continues to trade in negative territory after reports noted that the company may face costs exceeding $80M following the engine failure problems.
Notes/Observations: - China Trade Surplus widens with both exports and imports rising - China PBoC raises the RRR for the 6th time in 2010 (but not its key 1-year lending rates) ahead of key weekend release of CPI - US Trade data out later today and likely heat up the Yuan currency issue
Speakers: - India Central Bank Dep Chakrabarty commented that the RBI can still raise interest rates despite the pause in its outlook as policy remained accommodative. He added that inflation remained a major concern and might need to take steps if it does not decline to projected level by end of 2010/11 fiscal year (March). Lastly he added that the real interest rates remained negative -Spain Fin Min Salgado commented during a radio interview that the country's deficit targets were unconditional and would revise the budget as necessary to achieve targets. There were no plans to raise either gasoline taxes or value-added tax (VAT). She noted that the yields on government debt were not alarming but yields could rise on bond auctions in coming weeks. - ECB's Mersch commented that there was a scope for Euro zone financial stability fund to be broadened to prevent contagion. He added that he would not exclude Euro bonds but added that any EU-wide debt would require an EU-wide tax. The ECB saw financial risks on bond program as monetary policy should not be "overburdened". Cannot "blur" the line between monetary and fiscal policy and ECB cannot substitute for Gov't policy making. - IEA Monthly Report noted that it saw 2011 demand growth moderating after a strong Q3. It forecasted 2011 demand growth 1.3M bpd vs. 2.5M bps in 2010. It noted that Q4 Market fundamentals looked to be more balanced but demand could rise as a result of weather and/or tighter oil markets. The IEA raised Q4 oil demand by 300K bps to 87.8M bpd and increased Q4 Non-OPEC supply by 200K bps to 53.2M bpd. The IEA raised 2010 global oil demand to 84.4M bpd vs 86.6M bpd prior. It raised 2011 global oil demand by 300K to 88.8M bpd vs 87.9M bpd prior
Currencies: - Overall the currency markets entered a phase of consolidation into the weekend. - The EUR/USD once again saw its gains from the Asian session evaporate as the European morning wore on. The EUR/USD tested 1.3220 as the peripheral spreads and CDS widened a few basis points on the equity open. The Chinese RRR increase was greeted with hesitant relief that the PBoC did not raise its key one-year interest rates. The EUR/USD entering the NY morning back in positive territory and above the 1,3250 level. A break above 1.3330 could elect some sizeable Euro Buy stops that would be complemented by thinning liquidity conditions into year-end
Geopolitical/In the papers: - Iceland will repay approximately â‚¬4 billion to the UK and the Netherlands following an Icesave deal reached between the three countries. The repayment period would span 30 years beginning 2016 and end 2046. Iceland will begin interest payments on debt beginning 2011. The agreement next needs to be approved by both the parliament and president of Iceland. - The plan by the British coalition government to increase tuition fees won initial approved amid massive student protests. The motion, led by the coalition to raise English university tuition fees, passed with 323 voting in favor against 302 in the House of Commons, though approval by the House of Lords is still required. In total 21 Liberal Democrats along with 6 Conservatives voted against the motion with 2 Conservative members abstaining. Tuition fees could have the potential to be raised to a maximum of Â£9,000. There was also a second motion that passed, which would increase the main cap to Â£6,000 from Â£3,290 current.
***Looking Ahead *** - (PO) Portugal Oct Construction Works Index: No est v 75.6 prior - 6:00 (IR) Ireland Oct Industrial Production M/M: % v 7.9% prior; Y/Y: % v 10.9% prior - 8:30 (CA) Canada Oct Int'l Merchandise Trade: -C$2.0Be v -C$2.5B prior - 8:30 (US) Oct Trade Balance: -$44.0Be v -$44.0B prior - 8:30 (US) Nov Import Price Index M/M: 0.8%e v 0.9% prior; Y/Y: 2.9%e v 3.6% prior - 9:00 (US) Former Fed Chair Volcker speaks on Panel in Washington - 9:55 (US) Dec Preliminary University of Michigan Confidence: 72.0e v 71.6 prior - 10:00 (MX) Mexico Sept Gross Fixed Investment: No est v 4.8% prior - 11:15 (SP) ECB members Trichet and Ordonez Speak in Madrid - 13:00 (EU) EU President Van Rompuy speaks in Madrid - 14:00 (US) Nov Budget Statement: -$130.0Be v -$120.3B prior - (PE) Peru Oct Trade Balance: No est v $601.0M prior Key Weekend data: - (CH) China Nov CPI Y/Y: 4.7%e v 4.4% prior - (CH) China Nov Industrial Production Y/Y: 13.1%e v 13.1% prior
Have Market Intel? TradeTheNews.com Tip Line -> Click Here
Legal disclaimer and risk disclosure
All information provided by Trade The News (a product of Trade The News, Inc. "referred to as TTN hereafter") is for informational purposes only. Information provided is not meant as investment advice nor is it a recommendation to Buy or Sell securities. Although information is taken from sources deemed reliable, no guarantees or assurances can be made to the accuracy of any information provided. 1. Information can be inaccurate and/or incomplete 2. Information can be mistakenly re-released or be delayed, 3. Information may be incorrect, misread, misinterpreted or misunderstood 4. Human error is a business risk you are willing to assume 5. Technology can crash or be interrupted without notice 6. Trading decisions are the responsibility of traders, not those providing additional information. Trade The News is not liable (financial and/or non-financial) for any losses that may arise from any information provided by TTN. Trading securities involves a high degree of risk, and financial losses can and do occur on a regular basis and are part of the risk of trading and investing.
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.
POTENTIAL PRICE RISK: HIGH to Medium- Wed --14:15 GMT-- US- Industrial Production
POTENTIAL PRICE RISK: HIGH- Wed -- 15:00 GMT-- CA- Bank Of Canada Decision
John M. Bland, MBA co-founding Partner, Global-View.com
Max McKegg's Daily Forex Trading Forecasts
Veteran FX Trader, Max McKegg, forecasts all the Major currencies and the Australasians; providing Daily and Medium Term Trading forecasts to subscribers, who include large Banks the world over, as well as individual traders in more than 30 different countries.
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.