Top Forex Stories

The risk aversion sentiment has accelerated containing the markets following the falling of June personal income to 0.1% monthly revising down the figure of May to 0.2% from 0.3% while it was expected to be 0.3% and also monthly falling of US personal consumption expenditure by 0.2% while it was expected to rise by 0.2% in June with down revision of the figure of May from 0.2% to 0.1% in July. These new dovish data about the US economy has supported the demand for the gold to reach a new all times high at 1641 per ounce recovering the falling to $1606 because of the reached deal between the republican party and the democratic party of cutting the US governmental spending by $2.1 trillions over the next 10 years for having an agreement for raising the US debt ceiling avoiding defaulting but the rising worries about the US growth outlook have come back supporting the gold following the falling of July...

Trading in America has been sinking slowly and dragging the S&P 500 Index down with it, to the lowest level in almost two months. Bonds and commodities futures collapsed, while the storm clouds of a possible impending US default are gathering. The US dollar, however, appreciated. Surprisingly, the US dollar is finding opportunities for growth even under the threat of a default.  All of the problems surrounding the dollar and American bonds are only pushing it up. One can only imagine the euphoria with which enthusiastic investors will scramble to buy American bonds when the long-awaited news is finally announced. The S&P 500 Index went down 2% for the first time since June 1, falling to 1,304.89 points as of 4PM in New York. The cost of hedging against a default on US bonds went up to the highest rate since February 2010, while yields on 10-year treasury obligations increased two basis points to 2.98%. Coffee and oil futures lost over 1.5%,...

Today, Speaker of the House John Boehner announced to legislators that, despite the danger of a veto and the fact that negotiations in Congress are at a dead-end while the August 2 deadline looms near, he favors adding a short-term increase to the country’s debt limit over President Barack Obama’s proposed solution to the US’s debt problem. During a teleconference on Sunday afternoon, Boehner told rank-and-file Republicans that they should join together as a team to block Obama’s proposed $2.4 trillion increase to the current $14.300 trillion debt ceiling limit, which also stipulates all the funds are received simultaneously without having to give any guarantees on cutting government spending. Boehner’s comments were relayed to the press by someone closely involved with the course of the discussions. The Speaker of the House also said that no one wants to see the US default on its debt, therefore he is proposing a plan of only a short-term, $1 trillion increase in the debt ceiling...

The greenback has started the week under pressure on no reached deal between the current democratic ruling party and the republicans for hiking the taxes until now can open the door for succeeding voting for raising the current debt working $14.29B limit which has been reached in the middle of last May while the markets are waiting anxiously for the way the US Government to pay its financial obligations in the second of next month and it looks that till we reach this time the markets sentiment will be possessed by the development of this ascending problem in US eyeing on next Friday release of US Q2 GDP which is expected to get down to 1.6% y/y from 1.9% in the first quarter of this year. The Swiss Frank got use of this negative business spending sentiment and continued its pressure on the US dollar despite the recent weaker than expected release of Swiss trade balance of June which came at...

Optimism spread through financial markets in Europe and the United States after strong earnings from U.S. companies and better than expected U.S. housing data, which boosted confidence among investors, as they targeted higher yielding assets against lower yielding ones, which pushed the U.S. dollar to drop against majors. Several U.S. banks and companies reported their earnings for the second quarter of 2011, where IBM, Coca-Cola Co, Wells Fargo, Johnson & Johnson, Bank of New York Mellon, and Bank of America posted results that topped estimates, which provided stock indexes with strong momentum to rise, although Goldman Sachs, the giant U.S. bank reported disappointing results, however, traders were still focused on the bigger picture, since most U.S. firms reported strong earnings so far. Meanwhile, U.S. housing starts and building permits rose in June above expectations, which boosted confidence among investors, and increased demand for higher yielding assets, where housing starts rose by 14.6% to reach 629,000, well above expectations of 575,000, and building...

The markets are waiting for having more information about the US housing market today with the release of US housing starts of June which are expected to be 0.58M in June from 0.56 in May and also US building permits which are expected to be 0.61M in June from .612 in May while the equities markets seem to be rebounding this morning after strong selling in the recent days because of the markets growing worries about the US debt following warning of downgrading the US credit rating by S&P and Moody's last week without exceeding the $14.29 trillions ceiling of US debt which has been already reached on 16th of last May as what has been announced by the Timothy Geithner. These warning could contain the market sentiment with no reached deal yet between Obama and the majority of US Congress republic party senators who are asking for cutting the governmental spending by at least 2 trillions before accepting this request...

      Investors targeted higher yielding assets during the European session on Tuesday after some companies reported earnings that beat estimates. Those good earnings shifted the attention from Europe's and US's debt worries. Now markets will be eyeing the earnings from the big U.S. financial institutions. The dollar weakened today against its major counterparts as the worries about the U.S. debt situation persist. Officials must come to an agreement about the debt ceiling till August 2, deadline. The European leaders will meet in a summit later this week to further discuss Greece's new rescue plan. Pessimism will continue to dominate markets and caution may increase demand on safe heaven any moment as long as debt problems in the United States and Europe continue to weigh down on overall confidence. This keeps high demand on gold which today rose to a record high at $1609.97 level. Today the German ZEW economic sentiment survey showed current conditions being better than expected. This managed to give an extra...

Pessimism dominated global financial markets on Monday, where traders were concerned over debt problems in the United States and Europe, where traders are speculating EU leaders will fail to reach a resolution to the EU debt crisis in a summit this week, while U.S. lawmakers continue to negotiate raising the debt ceiling in the United States before an August 2, deadline. Meanwhile, European markets were under immense pressure after analysts signaled that the European stress tests results that were released last week don’t address the exposure of European banks to the Euro Zone’s debt crisis, which spread further pessimism in markets. The rising wave of pessimism in markets led investors to target low yielding and safe assets against higher yielding ones, where investors targeted lower yielding currencies and gold, noting that gold prices rose to a record high earlier on Monday above $1600 an ounce. Stocks in the United States fell by opening on Monday, where the Dow Jones Industrial Average was down...

Borrrrrrrrrrrrrrrrrrrrrrrrrrrrrring!! Overnight markets are again characterised by a combination of independent EUR weakness and generally diminishing appetite for risk. Although off the low ($1.4015), EUR/USD is still 100 pips down from Friday’s close. Ostensibly, EUR weakness is attributed to the limited credibility of Friday’s bank stress tests and is mirrored in wider peripheral spreads (Italy +13 bps; Spain +20 bps). More generally, equities are soft (US futures -0.6%), leaving JPY the top performing currency in G-10, with USD not far behind. SEK is the worst performer, though this has more to do with general risk appetite than the Riksbank minutes, which added little to the policy debate. White House and Republican leaders appear to have made little progress over the weekend in striking a deal to raise the debt limit, which is also weighing on risk sentiment. The House plans to vote on July 19th to increase the debt ceiling. Press reports suggest that President Obama has already moved to the...

The stress tests have been released and though the market ‘fretted’ that up to 20 firms, including some big fish, would fail, in fact the European Banking Authority said that only 8 firms failed, and most were small. The largest – ATE Bank - was said to need €713m, but €1.3bn was already earmarked for ATE by the IMF/EU. Of the failures, 5 were Spanish, 2 were Greek and 1 was Austrian. Late in the session, EU President Van Romuy called a heads of state meeting for July 21st regarding the “financial stability of the Eurozone as a whole and the future financing of the Greek programme.” The adage is that EU leaders have been responding to crises seemingly unable or unwilling to get in front and control the situation. In the US, the political chattering class, or at least some prominent elements, seem to court crisis regarding the debt limit/deficit cut debate. Overall, markets were mixed on Friday, down...