The Federal Reserve released the minutes of its April policy meeting yesterday. They showed no big surprises, providing no help for the US dollar. The greenback trimmed its gains versus the euro, was flat versus the Japanese yen and fell against the Great Britain pound. The minutes revealed that the Fed members were considering ways to tighten monetary policy: A staff presentation outlined several approaches to raising short-term interest rates … “Fed Minutes Show No Surprises, Leaving Dollar Without Direction”
Month: May 2014
Killing forward guidance
At certain points in recent years I’ve had the feeling that the cure is remarkably similar to what killed in the first place. Lending at rates that fail to reflect risks to nations already encumbered with debt, which is part of the reason why they ended up overly indebted. Add to this government intervention in … “Killing forward guidance”
UK Pound Maintains Gains After BOE Minutes
The minutes from the latest Monetary Policy Committee have been released, and there are signs that members of the committee are trying to decide how much slack there is in the market, and when they can start cutting back on bond asset purchases and when it makes sense to raise interest rates. Every month, the Bank of England’s Monetary Policy Committee meets to decide what it will do when it … “UK Pound Maintains Gains After BOE Minutes”
Aussie Drops with Consumer Sentiment
The Australian dollar dropped today as Australian’s consumer sentiment sank this month, hurt by the announcement of the Federal Budget that showed spending cuts and a new tax. The Westpac Melbourne Institute Index of Consumer Sentiment sank by 6.8 percent in May from the previous month. Bill Evans, Westpac’s Chief Economist, commented: The sharp fall in the Index is clearly indicating an unfavourable response to the recent Federal Budget. This puts the Index at its lowest … “Aussie Drops with Consumer Sentiment”
No Stimulus from BoJ, Yen Higher
The Japanese yen rallied today after the Bank of Japan left its monetary policy unchanged, refraining from adding monetary accommodation. Absence of stimulating measures is usually positive for a currency, and so it was in this case. The BoJ left interest rates near zero and the size of annual asset purchases at ¥60–70 trillion, in line with market expectations. The central bank said in the statement that “Japan’s economy has continued to recover … “No Stimulus from BoJ, Yen Higher”
AUD/USD: Trading the Chinese Flash PMI May 2014
Chinese Flash Manufacturing PMI (Purchasing Managers’ Index) is based on a survey of purchasing managers in the manufacturing sector. Respondents are surveyed for their view of the economy and business conditions in China. A reading which is higher than the market forecast is bullish for the Australian dollar. Here are all the details, and 5 possible … “AUD/USD: Trading the Chinese Flash PMI May 2014”
Yen Rallies as BoJ Starts Policy Meeting
The Japanese yen rallied against most major currencies on speculations that the nation’s central bank will refrain from adding monetary stimulus during the policy meeting that has started today. The Bank of Japan started its two-day policy meeting today and will announce its decision tomorrow. No changes to the policy are expected. The BoJ will also release its Monthly Report, which should provide insights into … “Yen Rallies as BoJ Starts Policy Meeting”
No Tightening from Fed in Near Future, USD Loses to GBP & JPY
The US dollar fell against the Great Britain pound and the Japanese yen today as US policy makers continue to attempt downplay expectations of an interest rate hike among traders, investors and other market participants. At the same time, the greenback gained on the euro and commodity currencies. Federal Reserve Bank of New York President William Dudley was speaking at the New York Association of Business Economics today. Regarding monetary policy of the US central bank, … “No Tightening from Fed in Near Future, USD Loses to GBP & JPY”
Euro Weakness Increases on Expectation of Easing in June
Euro weakness is increasing, with the 18-nation currency losing ground to most of its major counterparts today. Expectations that easing will go forward in June are weighing on the euro. The next ECB meeting isn’t until June 5, and many analysts expect that euro weakness will continue from now until then. Expectations that there will be easing are on the rise, especially after recent comments … “Euro Weakness Increases on Expectation of Easing in June”
Canadian Dollar Continues to Struggle in Forex Trading
The Canadian dollar continues to struggle in forex trading today, falling against its major counterparts as commodities struggle, and as traders consider recent disappointments in economic data. Loonie is having a hard time against other currencies today, falling almost across the board against its major counterparts. Canadian dollar is lower following last week’s disappointing jobs data, and now there is concern about about the release of March … “Canadian Dollar Continues to Struggle in Forex Trading”