Post Tagged with: "Producer Price Index"

Janet Yellen’s dovish testimony unsettles bourses

Asian bourses oscillated between gains and losses as it digested Federal Reserve Chairman, Janet Yellen’s testimony to the Senate Banking Committee where she cautioned that some sectors within the US equity market, in particular social media and biotechnology, have excessive valuations.  Yellen, was perhaps most candid about the labor market – albeit June’s unemployment rate print of 6.1%, other key gauges have remained stagnant as evidenced by the labor participation rate which was at 62.8%, its lowest level since 1978 and wage growth has seen little growth.  These factors coupled with sluggish inflation suggest that the US economy still has a ways to go before reaching full capacity and thus warrants the Federal Reserve to maintain interest rates low for a “considerable period” after the Fed winds down its asset purchase program, projected to conclude following the October meeting.

Antipodean currencies continued its descent despite an uptick in fundamental data from China where its economy expanded at a pace of 7.5% in the second quarter, slightly higher than the consensus of 7.4%, bolstered by government measures that boosted railway spending, tax reduction and cut in reserve requirements for some lenders to offset the threat of a weak property sector.  Typically, this set of data should have boosted the Aussie due to its reliance of China as its top trading partner; however, there is apprehension that Chinese growth is due more to credit expansion as opposed to real growth and how the print of 7.5% could discourage the Chinese government from injecting further stimulus into the economy.  In other data from China, industrial production increased 9.2% in June, higher than the 8.8% registered in May and retail sales rose 12.4% year on year boosted by strong figures in the online sector.  For the kiwi, its weakness was further exacerbated by a weaker than anticipated inflation rate of 0.3% in June against 0.4% expected and a decline in diary prices.

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Yellen’s speech sends dollar down

Yellen’s speech sends dollar down

Dovish undertones in Federal Reserve Chair Yellen’s first monetary policy speech reverberated through markets and have led the dollar lower against its peers with the dollar index declining 0.25% at time of writing to 79.63.  Yellen renewed the Fed’s pledge to maintain an accommodative stance until such time that the central bank is confident that [&hellip

Forex Daily Outlook – June 6 2011

Forex Daily Outlook – June 6 2011

We start the week with several interesting speeches in the US and Producer Price Index in Europe the main highlight on today’s outlook. Let’s see what awaits us today. In the US, we anticipate some interesting speeches: Timothy Geithner, Secretary of the US Department of Treasury, Charles I. Plosser, President  & Chief Executive Officer and [&hellip

Forex Daily Outlook – May 20 2011

Forex Daily Outlook – May 20 2011

  CPI in Canada and Producer Price Index in Europe are the major events this day. Here is an outlook on the market-movers awaiting us. In Canada, Bank of Canada CPI (Consumer price index) measures the cost of living by comparing basket of goods and services including volatile components, is likely to reduce by 0.6% [&hellip

Forex Daily Outlook – April 21 2010

Forex Daily Outlook – April 21 2010

US Philadelphia Fed Manufacturing Index , House Price Index and Unemployment Claims are the major market-movers. Let see what awaits us today. In the US, Philadelphia Fed Manufacturing Index based on a survey of manufacturers regarding trends in their business activities and growth a major indicator of business conditions expanded to 43.4 in March following [&hellip

Forex Daily Analysis – June 20th 2008

The British pound leaped 50 pips after the retail sales surged higher surprisingly. The market had expected a 0.1 drop, and was surprised to hear about a whooping 3.5 percent, the highest in 22 years. In Switzerland, the central bank met expectations by keeping the interest rate at 2.75%. The decision came despite inflation worries. [&hellip