User Name: Password:      Register - Lost password?

Forex News Blog
Back to The Headlines
Friday August 3, 2007 - 21:35:58 GMT
FX Solutions -

Share This Story:
| | Email

Market Directions - Sunday, August 5, 2007

Market Directions - Sunday, August 5, 2007

  • The ECB makes no move on rates but almost promises a hike in September
  • Moderate in all things, the US economy fails to excite trading interest and the Dollar falters at week end
  • The Japanese government of Shinzo Abe is defeated in Diet elections and the 'carry trade' stabilizes after falling more than 5% in the past two weeks

The Week in Review July 30 - August 3

United States

Disappointment in the American economy etched into the market at the close of the week as Non Farm Payrolls and Services ISM gave a much weaker than expected portrait of US growth prospects. The recent fall in the Euro against the Dollar, though largely due to technical and Yen cross related volatility issues had coincided with an excellent US GDP number for the second quarter. Traders were caught looking the wrong way on Friday, particularly by the ISM number which had been leading the recovery in US statistical measures. But much should not be made of these two statistics other than as a trigger for an end of the week profit reversal in the Euro. The American economy is not setting up for yet another turnaround. All recent statistics, consumer sentiment, income, ISM numbers, factory orders and purchasers indices point to continuing moderate economic growth, to lowered but still healthy job creation and diminishing inflation. This is hardly a picture to discourage business owners and consumers; traders are perhaps another question. Even the much commented sub-prime mortgage problem, illustrated by the failure of American Home Mortgage, has failed to ramify through the economy. The Federal Reserve should be extremely satisfied with statistical results of the past seven days and indeed the past several months. The PCE inflation rate for July was a miserly +0.1% capping a steady diminution from the +0.3% monthly rate of mid 2006. There will be no change of emphasis or concern at the FOMC meeting on this coming Tuesday. All in all Mr. Bernanke has good reasons to enjoy his summer vacation.


The European Central Bank (ECB) left rates unchanged at 4.0% on Thursday surprising not a soul. But in a hastily called news conference after the announcement Jean Claude Trichet, the president of the ECB, took care to use the term "strong vigilance' in characterizing the bank's attention to inflation. In fact, it almost seemed that Mr. Trichet convened the conference so that he could be quoted uttering the phrase 'strong vigilance'. Since May of 2006 Mr. Trichet has used this term three times and each time rates were raised 0.25% at the next meeting. Was this impromptu news conference held with the press by video link a response to French government criticism of ECB rate policy? Possibly. But without a direct promise, which he cannot provide, Mr. Trichet has once again given the strongest indication possible of ECB intention for September. Interestingly Mr. Trichet dodged a reporter's question as to whether rates are still accommodative and in doing so he noted the need to monitor turbulent financial markets. Is this an indication that a pause after the September increase is being considered? Surely it is too early to speculate but the ECB has proven to be most adept at the long warning and the incremental alert. There will be intense speculation on ECB policy after the September hike. Given past ECB behavior Mr. Trichet and his governors will begin preparing the market almost immediately.

United Kingdom

The pending Bank of England (BOE) inflation report due this Wednesday will likely give the bank enough room to delay a rate hike well into the fall. But expectation is still heavily weighted towards a 0.25% increase before the end of the year. At 5.75% the BOE rate is above what is usually considered 'neutral', neither promoting nor restricting economic growth. Deputy Governor John Gieve has called the current policy "on the restrictive side", but the economy has shown surprising resilience, particularly given the succession of rate hikes. Economic growth actually accelerated in the second quarter.


It appears the administration of Nicholas Sarkozy is trying to enlist the aid of the ECB, perhaps involuntarily, in reviving the French economy by strongly pressuring the central bank to reconsider its tight money campaign. The Deputy Minister for European Affairs, Jean Pierre Jouyet, speaking before the Finance Committee of the French National Assembly denied that he had intended to provoke the ECB with his comments last week, "at no time did I ever want to ... influence the members of the ECB", and "nobody in France questions ECB independence". But he then proceeded to do just that in the remainder of his speech. Consider his following points: key currencies in the world are politically managed and European political leaders must be able to discuss this issue with the ECB; the Maastricht treaty calls for dialogue between the monetary and political authorities; he does not believe in "the free reign of markets", when other currencies are clearly managed. "Each side [the ECB and the French Government] recognizes that there is a problem with the undervaluation of a certain number of Asian currencies". He suggested that ECB policy should be made within a "broad framework of policy analysis which includes not only price stability but growth and competitiveness". He also claimed that France's views are slowly "gaining ground" among European Monetary Union (EMU) members. Most European politicians faced with long term structural, competitive and social welfare constraints on their economies would no doubt welcome a looser ECB interest rate policy but apparently only the French are willing to say it quite so forcefully. Mr. Sarkozy knows that he can use all the help he can get in his drive to reform the sclerotic French economy.


The People's Bank of China (PBOC) raised bank reserve requirements by 50 basis points to 12% effective August 15th. Since April 2006 the PBOC has boosted the requirement 4.5% in nine increments, though this is the first hike since May 18th.

Trade and currency legislation aimed primarily at China, began its tortuous path through the American Congress. This legislation is a very useful counterpoise to the Bush' administration's negotiated approach, the legislative stick to the executive branch carrot.

Henry Paulson, the American Treasury Secretary, said that though the appreciation of the Chinese Yuan had increased over the past six months, "I don't believe it is fast enough. Faster appreciation will help the Chinese control their own economy. ...They [the Chinese government] could use traditional monetary policy to dampen overheating and hasten the development of the economy to higher valued products". Mr. Paulson will find ready audiences for these views in Beijing. The Communist rulers of China do not doubt the efficacy of capitalist financial thought, only the speed of its introduction to Chinese markets.


The ruling Liberal Democratic Party of Prime Minister Shinzo Abe suffered a major defeat, as predicted, in elections for the upper house of the Japanese Diet. Mr. Abe will not resign, as would have happened if the election had been for the lower house which elects the Prime Minister. But his ability to continue the economic reforms of his predecessor Junichiro Koizumi has been severely diminished. Will this defeat embolden the Bank of Japan to raise rates sooner rather than later, or will the ensuing political paralysis delay the normalization of interest rates even longer? Our bets are on the latter result.

New Zealand

Despite the Reserve Bank of New Zealand's (RBNZ) 0.25% rate hike on July 26th to 8.75% the New Zealand Dollar (Kiwi) has fallen over 5.5 % from its July 23rd peak of 0.8091. It touched bottom at 0.7531 on August 1st. 'Buy the rumor and sell the fact' and the need to convert paper trading gains into profits both work as explanations, but the catalyst was plainly the RBNZ's strong hint that the it may be reaching the end of the tightening cycle. The run down in the Kiwi included the largest four day drop in the currency against the Usd since 2001.

Economic Releases July 30 - August 3

United States

Tuesday: S&P Case Schiller Home Price Index registered 218.37 in May, lower than the April reading of 218.93 and raised fears that the housing market decline is reaccelerating. The Chicago Purchasers Index for July reported at 53.4, substantially less than the June result of 60.2. The Conference Board Consumer Confidence number for July at 112.6 exhibited the highest reading in over 6 years, 105.0 had been expected; the June reading was 103.9. The 'Jobs Plentiful 'category scored 30.5% well above the reading in June of 27.6% and the 'Jobs Hard to Get' reading fell to 18.4%, well off the equivalent June number of 27.6%. This jobs component is crucial to the overall buoyancy of consumer sentiment. Inflation expectations fell to 5.1% from 5.4%. Construction Spending dropped in June 0.3% on expectations for a gain of 0.2%; the May number was revised slightly higher to 1.1% from 0.9%.

Wednesday: The Institute for Supply Management (ISM) Manufacturing Index slid to 53.8 in July, less than the forecast of 55.5 and well below the June reading of 56.0. The employment index fell as well to 50.2 from 51.1; 'New Orders' were down also at 57.5 vs. 60.3. Nonetheless, Norbert Ore the Chair of the Institute for Supply Management Business Survey said that he thought "manufacturing [was] in fundamentally good shape. The June number had been the highest reading in more than a year and the July result remains above the average for the first quarter indicating moderate growth in the manufacturing sector. "Following a strong 2nd quarter, the manufacturing sector moderated somewhat this past month [July]...but continuing strength in new orders and production indicate that 3rd quarter performance should still be quite good", he said in a prepared statement issued with the figures.

Thursday: Factory Orders for June were up 0.6%, less than anticipated but a good recovery on the May decline of 0.5%.

Friday: Non Farm Payrolls for July underperformed at 92,000 jobs with a 0.1% rise in the unemployment rate to 4.6%. Predictions had been for 125,000 new jobs and a static unemployment rate at 4.5%. The private sector created 120,000 jobs for the month but, quite unusually, all government payrolls fell by 28,000. Government payrolls can be expected to resume growth in the coming months. State and local governments are flush with tax revenues and the federal deficit is falling much faster than had been predicted last year. The combination of steady private sector job creation and recovering government employment should keep the NFP numbers on a steady keel in the coming months.


Tuesday: the annualized Harmonized Index of Consumer Prices (HICP) for July rose 1.8%. It is the eleventh month in a row with this statistic below the ECB 2.0% target. Even so the ECB is very unlikely to forego at least one more 0.25% rate increase. Mr. Trichet, the bank president, has stated that the bank's concern is for the medium term inflation rate, not the monthly figure, and that the bank's planners still expect a rise in inflation later in the year. But with almost a full year of successful inflation figures one can wonder what the ECB defines as 'medium term'? The European Monetary Union (EMU) unemployment rate fell to 6.9% in June; the May rate was revised to 6.9% as well from 7.0%. There are 10 million people out of work in the EMU. As a comparison the unemployment rate in the United States is 4.6% and in Japan it is 3.7%. With EMU growth thought to be near potential and perhaps beginning to subside, French criticism of ECB policy becomes far more serious and credible.


Tuesday: the FSO (Federal Statistical Office) Retail Sales for June (annualized) at +0.7% was less than half the expected rise of 1.5%. The May number was revised lower to -2.5% from -1.8%. This weakness in consumer sales has cast some doubt on the generally buoyant consumer confidence statistics, and has undermined the hope of a self supporting economic recovery in the European Union. Past recoveries have been heavily dependant on exports. Germany has recently regained the title of the world's greatest exporting country by value of overseas sales.

United Kingdom

Wednesday: CIPS Manufacturing PMI for July was at 55.7 considerably stronger than expected; June was 54.7. New Orders were sharply higher as well reflecting the strength in the UK economy, somewhat surprising at this point in the BOE tightening cycle.


Monday: Industrial Output for June gained 1.2%, surpassing the forecast of + 1.0%. It is the first rise in four months. The May result was revised slightly ahead to -0.3% from -0.4%.

Tuesday: the unemployment rate fell one tenth of a percent to 3.7%. It was a new post 1998 low.


Non statistical releases

The Week Ahead August 6 - August 10

United States

Tuesday: preliminary Non-farm Productivity for the 2nd quarter at 8:30 am. An increase of 2.1% is forecast. The first quarter rate was +1.0%. Preliminary Unit Labor Costs for the 2nd quarter at 8:30 am, +1.6% is predicted, the first quarter was +1.8%. FOMC policy meeting, no change in rates or bias is expected.


Summer vacation: no important statistical releases


Monday: 10:00 Total Manufacturing Orders for June (seasonally adjusted, monthly and annualized) at 10:00 GMT, -0.8% is predicted for the monthly result and +10.1 yearly. The May numbers were +3.2% and +11.1% respectively.

Tuesday: Industrial Output (seasonally adjusted) for June at 10:00 GMT, +0.5% is forecast for the month and +5.1% for the year. The May figures were +1.9% and +4.6%.

United Kingdom

Monday: Manufacturing Output for June at 8:30 GMT. In May output rose 0.2% monthly and 1.0% yearly. Industrial Production for June at 8:30 GMT. The May numbers were +0.1% month on month and +0.8% year on year. British Retail Consortium (BRC) Retail Sales for July at 23:01 GMT. In June the like for like reading rose 2.2%

Wednesday: The Bank of England quarterly inflation report by the Governor of the BOE Mervyn King at 9:30 GMT.


Friday: release time undetermined, PPI for July, year to date and year on year. The June results were +2.5% and +2.8% respectively.


Monday: Preliminary Leading Index for June at 5:00 GMT, May was 18.2. Coincident Index for June at 5:00 GMT, May was 45.0

Wednesday: Machinery Orders for June at 23:50 GMT Tuesday. May rose 5.9%.

Friday: Revised Industrial Output for July at 4:30 GMT, the preliminary issue was down 0.3%. Consumer Confidence for July at 5:00 GMT, May reported at 45.0.

Joseph Trevisani
FX Solutions
Chief Market Analyst

[email protected]

IMPORTANT NOTICE: These comments are for information purposes only. Past results are not necessarily indicative of future results. Trading Futures, Options on Futures, and Foreign Exchange involves substantial risk of loss and may not be suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. You may lose all or more of your initial investment. Opinions, market data, and recommendations are subject to change at any time. The information contained on this email does not constitute a solicitation to buy or sell by FX Solutions,LLC., and/or its affiliates, and is not to be available to individuals in a jurisdiction where such availability would be contrary to local regulation or law.


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."

Actionable trading levels delivered to YOUR charts in real-time.

Register To Test Your Amazing Trader

GVI Trading. Potential Price Risk Scale
AA: Major, A: High, B: Medium

Tue 17 July 2018
AA 08:30 GB- Employment
A 13:15 US- Industrial Production
AA 14:00 US-Powell Testimony
Wed 18 July 2018
AA 08:30 GB- CPI
A 12:30 US- Housing Starts/Permits
AA 14:00 US-Powell Testimony
Thu 19 July 2018
AA 1:30 AU- Employment
AA 08:30 GB- Retail Sales
A 14:30 US- EIA Crude
A 12:30 US- Weekly Jobless
Fri 20 Jun 2018
A 12:30 CA- CPI/Retail Sales

John M. Bland, MBA
co-founding Partner,

Global-View Affiliate Program

We are starting an affiliate program to market some of our products.

Send me an email if you would be interested or if you know someone who would like to be an affiliate. Generous commissions payout for those accepted.

Put the word "affiliate" in the email subject line.

Contact us

Start trading with forex broker Markets Cube

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.

Request a TRIAL of Max's Forex Service.


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

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 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 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.



By using this website, you are agreeing to our Privacy Policy and Terms of Use, and Cookie Policy

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