Monday June 27, 2005 - 11:22:48 GMT
Share This Story
Mellon Bank Foreign Exchange - https://fx.mellon.com/
Forex: Mellon FX Daily - U.S. EditionKey Points
• EUR-USD price action confirms the market is set for consolidation through this week and next.
• The JPY may receive some independent influence from forthcoming data.
• German IFO a little better, Eurozone BoP not pretty, UK mortgage approvals lower. NZ business
confidence features today.
recovered further in Asia and moved through potential resistance in the 1.2142-60 area in early European trading. The current consolidation period is likely to extend through the next couple of weeks, with Thursday’s FOMC outcome, Friday’s ISM, next Monday’s July 4 holiday and the employment report the following Friday all likely to maintain a certain degree of market apprehension. A 1.20-1.2350 range is likely to hold things during this period, although clearly the tone of these key events as they unfold will carry market moving potential. Today, the next level comes in at 1.2205. The EUR has also been fighting back on other crosses, notably EURJPY
, with the latter having scope up to 133.50 today or tomorrow. However, there are a number of Japanese releases this week and these could turn out favourably for the JPY.
Today’s modest recovery in the German IFO
was broadly in line with market expectations and if this is replicated in other key Eurozone business surveys due out in this week, it may support the current stabilisation effort by the EUR. However, April balance of payments
data this morning for the Eurozone was less helpful. There was only a modest net outflow of €2.8bn on portfolio account, although this masked a net outflow on the equity category of €30.5bn (including net sales of Eurozone equities by foreign accounts of €38.9bn). European equity indices recovered through May and June after a weak April, but it is a danger signal. The current account was also a source of bad news, with a seasonally adjusted deficit being recorded for only the third time since July 2001. Some countries (France especially) are starting to see a big reversal to previous surpluses. The French current account deficit of €3.4bn for April was the largest since records are currently available for (i.e. 1993).
In the UK,
the BBA released data showing some slippage in the y/y growth rate for mortgage approvals to -24.2% from -23.4%. The y/y rate has been heavily in negative territory since June last year, although this is the first time the y/y rate has worsened since November. However, a better measure of approvals will appear with the official data on Wednesday, which includes all lenders, not just the banks. That data is seasonally adjusted and enables a better judgement on shorterterm trends. That series has been stabilising a little over the past couple of months, which is a little surprising, although it is unlikely to last. EUR-GBP has corrective risk along with other EUR crosses, although unless it can get back above 0.6725-35 it will be seen as purely corrective.
New Zealand –
watch out for business confidence today as this hit the NZD last month.
Data/event EDT Consensus*
NZ Business confidence (Jun) 09.00 -56.7% last
NZ Trade balance (May) 18.45 NZ$300m
JP Retail sales (May) m/m 19.50 -1.4%
Latest data Actual Consensus*
DE Import price index (May) y/y +2.2% +2.3%
SE Trade balance (May) SEK13bn SEK14.3bn
DE IFO index (Jun) 93.3 93.2
EU Current account (Apr) -€0.8bn €2.0bn
GB BBA mortgage approvals (May) y/y -24% -21% last
* Consensus unless stated
2005, Mellon Financial Corporation Note: Although obtained from sources believed by us to be reliable, Mellon Financial Corporation and its affiliates cannot guarantee the accuracy or completeness of the information upon which this report is based. This report does not purport to disclose the risks or benefits of entering into particular transactions and should not be construed as advice in any specific instance. The views in this report constitute our judgement as of this date and are subject to change without notice.
Ian Gunner 44 20 7163 5996 06.40 EDT Monday May 31 2005
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."