User Name: Password:      Register - Lost password?

Forex News Blog
Back to The Headlines
Friday June 22, 2007 - 18:24:20 GMT
BHF-Bank - www.bhf-bank.com

Share This Story:
| | Email

Forex Market News - FX Briefing 22 June 2007 - Carry trades push yen down to record lows

FX Briefing 22 June 2007
Highlights
• Speculation on interest rate hikes boosts carry trades
• First hedge fund victim of subprime mortgage problems
• Next ECB interest rate rise not before October

Carry trades push yen down to record lows
The prospect of further tightening in the high yield currencies plus fading hopes of the funding currencies raising interest rates are continuing to boost carry trades. At the end of the week in quiet trading, the yen remained steadfastly at its new record low. USD-JPY, currently at 124, fell near to its 4½-year low of 124.14, and EUR-JPY hit a new record low of 166.47. EUR-USD also only moved in a narrow trading range around 1.34.

It was not the central banks of the main currencies, but the minutes of the Bank of England’s monetary policy meeting that were the main cause for these movements. At the meeting at the beginning of June, only a very slim majority of 5 to 4 had voted to keep interest rates unchanged at 5.5%. As the result was so tight and because central bank chief Mervyn King had voted in favour of raising interest rates, market participants are now assuming that there will be a rate hike to 5.75% as early as July. Previously, markets had been expecting this to happen in August. Although cable benefited from this, it remained below 2.00 against the dollar.

Sweden’s central bank raised interest rates by 0.25 basis points and announced that there would be two further hikes before the end of the year. Subsequently, the Swedish krona appreciated by
over 1.5% against the euro. This fuelled speculation of other important central banks doing likewise.

This week the markets have been focussing more on potential credit risks again. Market participants have got used to central banks warning about underestimating the risks; however, now, commercial banks are starting to issue similar warnings as well. For instance, the Chairman of UBS has pointed out that the growing volume of risky loans could harm the reputation of the banking sector and possibly generate a flood of legal action, even if the risks are widely spread amongst investors. These remarks coincided with problems in two US hedge funds: as a result of the subprime mortgage sector crisis, they have got into a precarious situation. A $3bn rescue package is being considered. This would be on a similar scale to the LTCM fund rescue package in 1998.

Thus market participants’ attention reverted again to the problems in the US housing market. Data released this week did not indicate any improvement either: house owners, particularly those with a low credit rating, are still suffering from rising mortgage rates and falling residential property prices. After three consecutive increases, housing starts dropped again significantly;
building permits, which had declined sharply the previous month, only recovered slightly.

However, apart from the housing market, the US economy is looking very robust at the moment. The first purchasing manager indices for June show that growth has accelerated substantially in the second quarter. GDP growth rates for Q2 are being estimated at 3 to 4%, after 0.6% in Q1; even private consumption, which was weak initially, has increased significantly recently. The bond markets seem to have more or less priced this in with the last interest rate hike, which raised 10-year yields from 4.6% to over 5.3% temporarily. Thus expectations for the second half of 2007 are likely to be crucial: in view of high gasoline prices, rising interest rate levels and falling property prices, there has been a significant drop in US consumer confidence recently, which suggests that the strong growth momentum in the second quarter might not persist.

Unlike in the US, growth momentum in the eurozone seems rather to be declining somewhat in the second quarter. After weak production data from several EMU countries, partly due to public holidays, other economic indicators have turned out weaker too. For instance, consumer confidence in Italy has dropped noticeably, and in April and May, consumer spending fell in France. Sentiment indicators in Germany are pointing downwards for the first time: both the ZEW economic sentiment and the ifo business climate index turned out weaker than expected in June. Up to now, the data are indicating that growth will only be moderate in the second quarter.

The ECB’s last monetary policy meeting before the summer break is taking place at the beginning of July. There is not expected to be any change in interest rates or in the statement. At the moment, the market is counting on the central bank raising the refi rate to 4.25% in September, after the summer break. However, we are not expecting an interest rate hike before October at the earliest, because the ECB Council will first prepare markets for this step verbally. And if growth turns out weaker in the second quarter, the ECB will have no reason to hurry either.

Uwe Angenendt +49 69 718-3648
Economics Department
+49 69 718-3642
volkswirtschaft@bhf-bank.com
Foreign Exchange Trading
devisenhandel@bhf-bank.com
Jörg Isselmann
+49 69 718-2695
Matthias Grabbe / Klaus Näfken
+49 69 718-2688

This 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 States.
© 2007 BHF-BANK Aktiengesellschaft
All rights reserved. Please mention source when quoting from it.

 

Forex Trading News

Forex Research

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 here.

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.
  • Live trading strategy sessions.
  • Market Updates with Trading Tools.

Register To Test Your Amazing Trader


Trading Ideas for 18 December 2017

Register for the Amazing Trader

1.

Amazing Trader EVENT RISK Calendar:

Mon 18 Dec
10:00 EZ- final HICP
Tue 19 Dec
09:00 DE- IFO Survey
13:30 US- Housing Starts/Permits
13:30 US- Current Account
Wed 20 Dec
15:00 US- Existing Homes Sales
15:30 US- EIA Crude
Thu 21 Dec
03:00 JP- BOJ Decision
13:30 CA- CPI & Retail Sales
13:30 US Weely Jobless
13:30 US- GDP
Fri 22 Dec
09:30 US- GB- GDP
13:30 US- core PCE Deflator & Presonal Income
15:00 US- New Homes Sales
15:00 US- final University of Michigan
17:00 US- early Closes
Mon 25 Dec
00:00 Christmas Holidays

Forex Trading Outlook


Potential Trading Opportunities

  • POTENTIAL PRICE RISK: Medium Mon--10:00 GMT-- EZ- final November HICP. flash data are rarely changed.


  • POTENTIAL PRICE RISK: HIGH- Medium Tue --09:00 GMT-- DE- IFO Survey. Key report but usually not a market-mover
  • POTENTIAL PRICE RISK: HIGH- Medium- Tue --13:30 GMT-- US- Housing Starts and Permits. Leading indicators of activity

  • POTENTIAL PRICE RISK: HIGH-Medium- Wed --15:00-- US- Existing Homes Sales. Top Housing statistic
  • POTENTIAL PRICE RISK: Medium- Wed --15:30-- US- EIA Crude

John M. Bland, MBA
co-founding Partner, Global-View.com EXCLUSIVE: Global-View Daily Trading Chart Points Updated

EXCLUSIVE: Global-View Free Forex Database updated




TRADER ADVOCACY ARTICLES

Trader's Advocate Articles..

pic

Retail Forex Brokerage Changing!

Are you 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.

Our Best Brokers listing section includes:Forex Broker Reviews, Forex Broker Directory, Forex Broker Comparisons and advice on How to Choose a Forex Broker

If would like guidance, advice, or have any concerns at all ASK US. We are here to help you.

SEE Our Best Brokers List

Currency Trading Tools

  • Live rates, currency news, fx charts. 

  • Research reports and currency forecasts.

  • Foreign Exchange database and history.

  • Weekly economic calendar.

Directory of  Forex trading tools

 
Terms of Use    Disclaimer    Privacy Policy    Contact    Site Map


Forex Forum
Forex Trading Forum
Forex Forum + forex rates
Forex Forum Archives
Forex Forum RSS
Free Registration

Trading Forums
Currency Forum Guide
Forum Directory
Open Forum
Futures Forum
Political Forum
Forex Brokers
Compare Forex Brokers
Forex Broker News
Forex Broker Hotline

Online Forex Trading
Forex Trading Tools
Currency Trading Tools
Forex Database
FX Chart Points
Risk/Carry Trade Chart Points
Economic Calendar
Quicklinks to Economic Data
Currency Futures Swaps
Fibonacci Calculator
Currency Futures Calculator

Forex Education
Forex Learning Center
FX Trading Basics Course
Forex Trading Course
Forex Trading Handbook

Forex Analysis
Forex Forecasts
Interest Rate Forecasts
Central Bank Forecasts

FX Charts and Quotes
Live FX Rates
Live Global Market Quotes
Live Forex Charts
US Dollar Index Chart
Global Chart Gallery
Daily Market Tracker
Forex News
Forex Blog
Forex News
Forex Blog Archives
Forex News RSS
Forex Services
Forex Products
GVI Forex
Free Trials
FX Bookstore
FX Jobs and Careers
Jobs USA
Jobs UK
Jobs Canada

Forex Forum

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.

Forex News

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

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.

Forex Brokers

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 Trading

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.

FX Trading

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.

Forex Blog

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.

Copyright ©1996-2014 Global-View. All Rights Reserved.
Hosting and Development by Blue 105