The South African rand weakened today as strikes continue to plague the country, now in the agricultural sector, spooking investors away from South African assets. Protests in the grape-growing Western Cape province, which have started last week, already led to one fatality. The unrest followed mining strikes that caused 46 deaths. Such events certainly do not make the country attractive to investors, reducing value of its assets. USD/ZAR … “Rand Drops as Protests in South Africa Spook Investors”
Month: November 2012
US Dollar Lower for Now
US dollar is lower for now, even though there appears to be a lot of data that is likely to weigh on high beta currencies and turn the situation around. For now, the greenback is down against most of its major counterparts, and risk appetite is still a factor for Forex traders. Right now, risk appetite is still seen, and high beta currencies are fighting to maintain earlier gains made against … “US Dollar Lower for Now”
Is the IMF Ready to Leave Troika and Greece?
The head of the Eurogroup Jean-Claude Juncker and the managing director of the IMF, Christine Lagarde, had a public disagreement over Greece’s targets. This disagreement could now turn into a bit more than that. There are some statements in that direction. The IMF wants another round of debt restructuring for Greece in order to meet … “Is the IMF Ready to Leave Troika and Greece?”
A Grexit or a haircut – Germany’s choice
With the paths of devaluation or inflation not viable or not available, there is no way that Greece could stay in the euro-zone without an official sector haircut, says Simon Smith of FxPro. The “official sector” consists of the IMF, the ECB, and euro-zone governments, with Germany being the largest. In the interview below, Smith … “A Grexit or a haircut – Germany’s choice”
Yen Drops on Speculations About Elections in Japan
The Japanese yen dropped yesterday and maintained its losses today on speculation that the likely victory of the opposition party in the coming elections will lead to further interventions from policy makers in order to support the economy. Japanese Prime Minister Yoshihiko Noda hinted yesterday that he may dissolve the parliament, triggering elections. Analysts believe that the elections will favor the opposition Liberal Democratic Party. The party’s leader Shinzo Abe called … “Yen Drops on Speculations About Elections in Japan”
Euro Jumps Despite Negative Fundamentals
The euro unexpectedly jumped today even as fundamentals in Europe were not supportive for the currency. The likely cause for the rally was the release of the Federal Reserve minutes that showed probability of additional quantitative easing. The Federal Open Market Committee released the minutes of its last monetary policy meeting. The minutes showed that some policy makers considered additional stimulating measures: Looking ahead, a number of participants indicated that additional asset purchases … “Euro Jumps Despite Negative Fundamentals”
FED minutes reveal a split in decision
The minutes from the Federal Open Market Committee (FOMC) meeting of Oct 23-24, revealed Federal Reserve officials generally gave positive reviews to their latest round of bond-buying saying it was helping to spur financial markets. FED members considered that the decision to buy $40 billion of mortgage-backed securities each month was effective in lowering long-term … “FED minutes reveal a split in decision”
USD/JPY: Trading the Philly Fed Manufacturing Index November 2012
The Philadelphia Fed Manufacturing Index is an important leading indicator, and is based on a survey of manufacturers in the Pennsylvania and New Jersey region. It examines manufacturers’ opinions of business activity, and helps provides a snapshot of the health of the manufacturing sector. A reading which exceeds the forecast is bullish for the dollar. … “USD/JPY: Trading the Philly Fed Manufacturing Index November 2012”
NZ Dollar Drops with Retail Sales, Outperformed by Aussie
The New Zealand dollar fell against other majors today, including its Australian counterpart, after data showed a drop of New Zealand retail sales. At the same time, Australian consumer confidence improved. New Zealand retails sales fell 0.4 percent in the third quarter of 2012, following the increase of 1.3 percent in the preceding quarter. Analysts have hoped that sales would grow at the same 0.4 percent rate. Westpac Australian … “NZ Dollar Drops with Retail Sales, Outperformed by Aussie”
Gaza assassination could cause Significant Mid-East Escalation – Dollar
Israel killed the chief of staff of Hamas, which controls the Gaza strip. The assassination of Ahmed Jaabri is a significant escalation in the recent clashes between the sides, and it could turn into a full scale war in Gaza. Oil prices are already higher, and safe havens currencies such as the dollar and the yen could … “Gaza assassination could cause Significant Mid-East Escalation – Dollar”