Forex trading began this week with the end of the Gaza war. The ceasefire declared by Israel was followed by Hamas. This shifted focus from oil prices during most of the week. A renewed surge in oil prices began on Friday, lifting the Canadian dollar.

In Japan, the Overnight Call Rate stayed at 0.1% according to expectations. In the accompanying Monetary Policy Statement, the BOJ stated that it still saw the economy shrinking, and that it would buy bonds in order to ease funding.

Another major news item this weekend, is the British bailout plan. The British government plans to create a bank that will absorb bad loans / bad debt. The scale of this plan is huge: 200 billion pounds. This will bring the total expenses of dealing with the crisis to almost one trillion pounds, or 33,000 for every British tax payers. More details about this bailout plan will be officially released at the beginning of the week.

After 3 weeks of intense fighting in Gaza, the conflict might reach it’s end, as this ceasefire is backed by the Palestinian authority, Egypt and major European countries. Chancelor Angela Merkel of Germany, President Nicola Sarkozi of France and PM Gordon Brown of Britain will arrive in Egypt and Israel on Sunday to see that it really happens.

Obama’s election, after almost two years of campaigning, was a historic one: he’s the first black president. Obama’s victory on November 4th, was a landslide victory that inspired a hope for change almost everywhere on the planet.

After yesterday’s fall, EUR/USD is now trading rather stable, at 1.32.

Hammas will hold a press conference later in a few hours, in which it is expected to agree on a truce, including observers in the Rafah border crossing – one of the big disputes in the Gaza conflict.

In Australia, the monthly Home Loans were surprisingly good – they showed a rise of 1.3%, more than 1.0% that was expected. AUD/USD now trades at 0.6771, a rise of 1.5%, after dropping significantly yesterday.

Oil prices have fallen significantly, now under $37 a barrel. The Gaza war currently isn’t flaring the whole middle east, and everybody is already used to hear bad news from Gaza. Oil is back to normal.

Important economic data begins early on Wednesday: In Austtralia, the monthly Retail Sales Trend is expected to show stability, at 0.1%. Also the HIA New Home Sales is a good indicator of the Australian economy and is published by the Housing Industry Association.