Forex Daily Outlook – October 20th 2009

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After another day of dollar weakness, we have significant American figures today, especially in the housing sector and also a rate decision in Canada. Let’s review the events that will impact trading:

Renewed dollar weakness took the kiwi above 0.75. Are the markets expecting a rate hike in New Zealand? USD/CHF also advanced downwards on the way to parity, and was just 100 pips away during the night.

Australian Monetary Policy Meeting Minutes started the day with a rather cautious notion. No more emergency steps, but no definite rate hike path soon. AUD/USD is stuck under 0.93 resistance line. For more on the Aussie, read the AUD/USD Forecast.

In Germany, prices fell again. PPI fell by 0.5%, falling short of expectations for an unchanged number. EUR/USD is just under 1.50. For more on the the Euro, read the EUR/USD Forecast.

In Britain, Public Sector Net Borrowing is expected to squeeze to 15.2 billion this time. GBP/USD managed to push higher yesterday, but is now back down under 1.64.

Later today, BoE governor Mervyn King will make a public appearance. He might clear his stand regarding Quantitative Easing. Different reports about this program shook the markets. For more on the Pound, read the GBP/USD Forecast.

In Canada, the Leading Index is expected to continue the positive trend, and rise by 0.9%. Wholesale Sales are expected to fall by 0.4% after rising last time by 2.8%. But these are just a prelude.

In the US, Building Permits are expected to edge up 590K signalling slow growth of the housing sector. A related release is the Housing Starts, which are expected to edge up as well, from 600K to 620K.

American Producer Price Index, PPI, is predicted to rise by 0.1%, after a big 1.7% rise last time. Core PPI is expected to show stability, rising by 0.1% after a 0.2% rise last month. Later, FOMC member Kevin Warsh will speak.

The BOC is expected to leave the interest rate unchanged at 0.25%. The Canadian Overnight Rate is at 0.25% for a long time. The accompanying BOC Rate Statement will supply hints about when a rte hike will happen – in which quarter in 2010. USD/CAD now trades at 1.0300.

For more on the loonie, read the USD/CAD Forecast.

That’s it for today. Happy forex trading!

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About Author

Yohay Elam – Founder, Writer and Editor I have been into forex trading for over 5 years, and I share the experience that I have and the knowledge that I’ve accumulated. After taking a short course about forex. Like many forex traders, I’ve earned the significant share of my knowledge the hard way. Macroeconomics, the impact of news on the ever-moving currency markets and trading psychology have always fascinated me. Before founding Forex Crunch, I’ve worked as a programmer in various hi-tech companies. I have a B. Sc. in Computer Science from Ben Gurion University. Given this background, forex software has a relatively bigger share in the posts.

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