Tuesday, January 30, 2007

Forex News: 30.01.2007 U.S. Jan. consumer confidence index rises to 5-year high

A gauge of U.S. consumer confidence inched higher in January, pointing to moderate improvement in the first half of the year.

The consumer confidence index rose to 110.3 in January from a revised 110.0 in December. It's the highest since May 2002. Economists were looking for an increase to about 111.0.

Forex News: 30.01.2007 Consumer credit rose in Great Britain in December

The index of consumer credit in Great Britain, which includes credit cards’ borowing, bank credits and hire purchases, was in December +1.03bln stg, the Bank of England reported today.

November reading was revised from +1.00 to +1.13bln. The number of mortgages was 113K in December, compared with 129K in November.

As a whole, the consumer credit rise reflects the increase of consumer confidence as the consumers are not afraid to run into debt on expensive goods. As a rule, the increase of the index is reflected in national currency rise.

Forex News: 30.01.2007 NorthFinance: Current oil prices can result again in the Middle East conflict

“FOMC will keep its interest rate unchanged, though the opinions on its rise are controversial”, Sergey Popov, NorthFinance financial analyst says.

“First, the economic statistics in the preceding two months reflects seasonal changes. Second, FOMC, taking the pause in interest rate’ rise, provides support to dollar, keeping it resold. This will positively influence the budget deficit and trade balance.

If we pay attention to the rise of trade balance between EU and China, the further increase of euro above the level of 1.31 is extremely unwanted for the economy of the european countries. It is possible to speak about ECB interest rate’s rise, despite rather conservative economic politics of Jean-Claude Trichet.

The consumer credit in Great Britain is the most interesting news today. The index is most likely to be in the range of expectations. This will confirm the expediency of interest rate’s increase at the last meeting of BoE.

As for the US consumer credit, it is expected to drop, in connection with public discontent toward the international politics of the USA. The critic is aimed at the federal party, precisely, at its head George Bush.

The extremely warm winter in the northern hemisphere results in oil market stagnation, durable stay of prices in the range of $50-60/a barrel strongly slows down the economic growth of countries, dependable on oil, especially of extensively developing Iran. Such oil prices will add to uncertainty in the Middle East and may draw to the conflict in the region for the rise of price of black gold”, NorthFinance analyst considers.

Thursday, January 25, 2007

Forex News: 25.01.2007 U.S. Dec. existing-home sales fall 0.8%

Sales of U.S. existing homes fell 0.8% in December to a seasonally adjusted rate of 6.22 million.

Sales in December were down 7.9% compared with December 2005. Inventories of unsold homes fell 7.9% to 3.51 million, representing a 6.8-month supply, the National Association of Realtors said in the report.

The decline in sales was close to the 6.24 million expected by economists. The average median sales price was $222,000 in December, unchanged from December 2005.

Forex News: 25.01.2007 Initial jobless claims up to 325,000 last week

The number of newly workers filing applications for state unemployment benefits climbed sharply in the latest week, suggesting some slack in labor markets at the beginning of the year.

First-time claims for jobless benefits rose by 36,000 to a seasonally adjusted 325,000 in the week ended Jan. 20. Economists had been expecting 310,000 new claims.

Meanwhile, the four-week average of initial claims rose by 1,500 to 309,250. Economists consider the four-week average a better measure because it smoothes out one-time events like strikes or weather.

The number of people continuing to collect unemployment benefits fell by 39,000 to a seasonally adjusted 2.48 million in the Jan. 13 week.

The four-week average of continuing claims fell by 9,500 to stand at 2.46 million, the lowest since Nov. 18.

The insured unemployment rate remained steady at 1.9%.

Forex News: 25.01.2007 Current account in the euro area showed the deficit of EUR 2.0bln in November

In November 2006 the seasonally adjusted current account of the euro area revealed the deficit of EUR 2.0bln, compared with EUR 0.4bln in the preceding month, the European Central Bank reported today.

The rise of current acсount deficit was observed as deficits on current transfers ( EUR 9bln) and incomes (EUR 2.5bln) exceeded surpluses in goods (EUR 7bln) and services (EUR 2.4bln).

In non-seasonally adjusted terms, the surplus of current account in the euro area was 1.7bln.

At the annual rate the deficit of current account in the euro area was EUR 26.4bln (0.3 of GDP), compared with the surplus of EUR 5.6bln a year earlier, which is mainly connected with a decrease in goods surplus by EUR 29.1 bln.

Forex News: 25.01.2007 Ifo business climate index in Germany is down again in January

Although the analysts were positive about Ifo data in Germany and expected its growth to 109.0 points, Ifo business climate index was down again in January and amounted to 107.9 points. In December the index was 108.7 points.

Ifo business climate index is estimated on the survey of 7000 companies, who express their opinion toward the current economic situation as well as the expectations of the nearest future.

It is important to note that, Ifo component, reflecting current situation in Germany droped abruptly in January and was 112.8 points, againts 115.3 points in the preceding month. The index of economic expectations rose by 103.2 points from 102.5 points in December.

Wednesday, January 24, 2007

Forex News: 24.01.2007 UK GDP increased 0.8% in the fourth quarter

British Gross Domestic Product has increased by 0.8% in the last quarter of last year and by 3.0% from the 2005.

The figures, which came out in line with the market expectations, have been the strongest in more than a year. The 0.8% quarterly growth has been the strongest since the 0.9 recorded in the second quarter of 2004 and the 3.0% yearly increase is the largest seen since the 3.1% recorded in the third quarter of 2004.

The growth has to do with the services sector, more specifically with wholesaling, retailing and transport support; services sector has grown 1.0% in the fourth quarter. Industrial production has fallen 0.2% in the 4Q.

Forex News: 24.01.2007 BoE: Inflation is not to slow down, as it was expected

The Bank of England published today the minutes of monetary policy Committee meeting of January 11-12, when the rates were unexpectedly increased by 25 points to 5.25%.

As a whole, the economic growth was robust and the the risks of slowing down, especially in the USA, diminished. The data on inflation in Great Brritain was almost up to expectations, but short-term rise may be expected.

The reason for major concern is high asset prices, which can directly press houshold wealth and demand for goods and services. Nevertheless, some members of the Committee doubt that high asset prices can substantially influence nominal economy, for instance, inflation expectations.

The decision to rise interest rates was made on the ground that the inflation rise is still above expectations at the moment, which is connected with unexpected increase of energy costs. Five members of the Committee, who voted for the rate increase, consider that inflation is not to slow down so quickly as it was earlier expected.

Tuesday, January 23, 2007

Forex News: 23.01.2007 CBI price balance rise over the decade

The rate of increase in manufacturers' domestic output prices has picked up markedly, according to the latest survey by the CBI. 25 per cent of firms said that average domestic prices have gone up in the past three months, while nine per cent said they have fallen, giving a rounded balance of 15 per cent - the highest since July 1995 (+19).

This was a marked increase on the previous quarter (a balance of +3%), but was not wholly unexpected, as in the previous survey a balance of 12 per cent of firms had said they hoped to raise prices.

Over the last three months the volume of total new orders rose for a balance of ten per cent. 15 per cent of respondents expecting orders to grow in coming months.

Forex News: 23.01.2007 U.S. Dec. leading economic indicators up 0.3%

The U.S. index of leading economic indicators rose 0.3% in December, the fastest pace since September.

Six of the 10 indicators increased in December, starting with building permits, jobless claims and money supply. The biggest drags were interest rate spreads and consumer expectations.

The leading index was cut to flat in November, compared with 0.1% originally reported. The coincident index rose 0.2% in December and the lagging index rose 0.9%.

Forex News: 23.01.2007 The ascending dollar trend is continuing

“Today we see the continuation of the ascending trend of dollar toward other currencies, excluding yen. The favorite of this movement is British pound, and the kea psychological aim in case of breaking through will be 2.00”, Georgiy Fedotov, NorthFinance financial analyst says.

“Yen continues to weaken toward major currencies. The traders expected that the Bank of Japan would depart the policy of zero interest rates, but the expectations were not realized and the possibility of rate rise is slight. In connection with this, cross-rates GBP/JPY as well as EUR/JPY continue further movement. On GBP/JPY pair we approached the level of 1998. It is obvious that the movement will continue.

As for EUR/USD, the pair is greatly influenced by two factors: oil prices’ drop and nature disasters (the loss after Kirill hurricane was 4-8bln dollars). In connection with this, euro is positioned within a very narrow range. We may say it for sure that figures 1.30-1.32 will appear in the nearest future”, the analyst says.

Friday, January 19, 2007

Forex News: 19.01.2007 UK retail sales rose by 1.1 pct in December

Retail sales have experienced the stronger growth since December 2003, according to the latest data by National Statistics.

Retail sales have grown by 1,1% from November and 3.7% in the last 12 months, sharply above the market’s expectations of a 0.5% monthly gain and a 3.4% year on year increase.

November data has been revised to a 0.2% monthly increase and a 3.1% yearly rise.

Forex News: 19.01.2007 The budget deficit (PSBR) in UK was up to expectations

According to the data released by National Office of Statistics today, the budget deficit (PSBR) rose twice in December, coming up to analysts’ expectations.

The index was 13.4bln stg in December, compared with 7.1bln in November, which is 1.9bln lower than in December 2005.

At the annual rate, the budget deficit was 36.9bln stg, 6.8bln lower than in the preceding year (43.7bln).

At the end of December 2006 public sector net debt was 504.1bln, which is equivalent to 38.1 percent of GDP. In the end of December 2005 the index was 467.1bln - 37.3 percent of GDP.

Forex News: 19.01.2007 Even the drop of oil prices did not help American currency

“As we denoted before, EUR/USD pair was in the corridor of 1.2930 during the week. Despite positive news releases, euro regained previous drop and “drew” the week maximum. Even the drop of oil prices did not help American currency (Oil prices tended to fall throughout the week). It is still at its local minimums 51.5”, Artem Enshin, NorthFinance financial analyst says.

The pound sterling was stably volatile during the week. The summary rise from the beginning of the week was almost 200 points. Its movements were especially active yesterday. Following the drop 1.9650, it came back to its local maximums, to the level 19775. This indicates that we returned to the price maximums of yearly December. The pound is almost at the maximums of recent years and the level 1.9800 will produce rather strong technical resistance.

Today we expect the publication of the UK budget deficit (PSNCR) in December. In November, the index was 7.1bln stg. Two times increase is expected, to 15.3bln stg. Retail sales in Great Britain are also published today. In the preceding month, the index was 0.3%. in December it is supposed to rise by 0.5%. According to analysts’ opinion, the preliminary Michigan sentiment index will be 92.0% in January, compared with 91.7% in the preceding month.

Forex News: 19.01.2007 Jan. Philly Fed index rose to 8.3

The manufacturing sector in the Philadelphia region grew modestly in January, the Federal Reserve Bank of Philadelphia reported Thursday.

The Philly Fed index of manufacturing sentiment rose to 8.3 from negative 2.3 in December. Economists expected an increase to about 2.5.

In January 25% of firms said business was improving, while 16% said conditions were worsening. The index is constructed by subtracting the number of negative responses from the positive ones. Readings over zero in the diffusion index indicate growth.

The new orders index rose to 1.3 in January from negative 0.9. The prices paid index fell to 11.9. The employment index inched up to 7.9 from 7.5. The expectations index jumped to 22.4 in January from 5.4 in December.

Thursday, January 18, 2007

Forex News: 18.01.2007 Jobless claims index unexpectedly dropped in the USA

Although the analysts expected substantial increase of jobless claims, the index unexpectedly fell in December. Jobless claims fell in a week of January 13 to 290K, from 298K in the preceding week. The index was expected to rise by 315K.

The average number of jobless claims in four weeks of January 13 fell to 308K, from 314.5K the week before. The number of unemployed by January 6 was 2.530bln, compared with 2.410bln in the preceding period.

The drop of jobless claims index is a positive factor for dollar rise, but, in most cases, the publication produces limited effect upon the market.

Forex News: 18.01.2007 U.S. housing starts rise in December

New construction on homes in the United States rose for the second straight month in December on strength in apartment construction. Housing starts rose 4.5% to a seasonally adjusted annual rate of 1.64 million, the highest level since September.

Economists expected December housing starts would fall to a 1.57 million pace. Starts rose a revised 6.4% in November to 1.57 million units, down slightly from the initial estimate of a 6.7% gain.

Building permits rose 5.5% to an annual rate of 1.60 million in December from 1.51 million in November.

For all of 2006, housing starts fell 12.9% to 1.80 million, the biggest decline since 1991.

Forex News: 18.01.2007 Inflation in the USA exceeded expectations in December

The consumer price index in the USA, reflecting inflation pressures, rose in December by 0.5% toward the preceding month, the Ministry of Trade reported today. CPI excluding food and energy rose in December by 0.2% at the monthly rate.

The consumer price index slightly exceeded expectations. The analysts expected that CPI would rise by 0.4% in a month, while CPI excluding food and energy - by 0.2%.

At the annual rate consumer prices in the USA rose in December by 2.5%, CPI excluding food and energy - by 2.6%.

Forex News: 18.01.2007 U.S. December industrial production rises 0.4%

U.S. industrial production rose by a stronger-than-expected 0.4% in December, as the high-technology and motor-vehicle industries posted strong output for the month.

Output in November was revised to a decrease of 0.1%, down from the initial estimate of a 0.2% gain.

Manufacturing output rose by 0.7% in December after being flat in November.

Over the past year, industrial production has risen 3%.

The increase was greater than expected. Economists had expected production would be flat in December.

Monday, January 15, 2007

Forex News: 15.01.2007 Nov. Euro Zone industrial production rose 0.2%

Euro Zone’s Industrial Production has bounced back to positive levels in November, yet the reading has been weaker than expected.

Industrial Production has grown by 0.2% in November, as data from the European Stats agency shows, this reading remains sharply below the 0.8% increase expected by the analysts, after two consecutive declining months. The yearly 2.5% increase is also below the 3.1% expected by the economists.

Production of intermediate goods has fallen 0.1% while durable consumer goods output increased 1.0%, capital goods 1.2% and energy 0.9%.

Forex News: 15.01.2007 The rise of PPI in Great Britain exceeded expectations

As the National Office of Statistics reported today, the producer price index, reflecting price inflation for manufactured products, rose more substantially than the analysts expected.

The output producer prices rose in December by 0.2% in a month and by 2.2% in a year, compared with 0.0% and 1.8% in the preceding month.

The input producer prices, which do not include labor costs, increased in December by 0.3% in a month and 2.7% in a year, compared with 0.1% and 2.8% in November, in a month and year respectively.

Nevertheless, the growth of producer prices, excluding food and energy, slowed down in December since the index was 0.1% in a month and 2.3% in a year, compared with 0.2% and 2.4% in the preceding month.

Forex News: 15.01.2007 News to expect this week

“The week is quite poor for events”, Artem Enshin, NorthFinance financial analyst says, - “The most significant news of today is the rise of PPI in Great Britain to 0.2% from 0.1% as well as industrial production in Great Britain in November. The index is expected to substantially rise, from -0.1% to 0.8%.

The only Tuesday news is ZEW economic expectations in Germany in January. It is important to note that economic expectations improved in December, after ten consecutive falls. December reading was the highest since August 2006, -19. The analysts expect the index rise again in January, to -11.

The most noticeable indicator of Wednesday is ILO jobless rate for three months. The analysts expect the index keep steady on the level 5.5%, as in the preceding two quarters. Trade balance in the euro area is also released on Wednesday; the index is expected to rise from $2.4bln to $3.9bln. This day is rich in US statistics. PPI in December is to fall substantially, from 2.0% to 0.6% as well as the industrial production is to drop from 0.2% to 0.1%.

Thursday is saturated with US news. Thus, at 4.30 p.m. (Moscow time) the consumer price index is published. As it is forecasted, the index is to rise from 0.0 to 0.5. Jobless claims are traditionally published on Thursday. In the preceding week, the index was 299K, which was the lowest level since November 16 2006. The index is expected to rise this month by 11K.

Friday, January 12, 2007

Forex News: 12.01.2007 Dec. U.S. retail sales rose 0.9%

U.S. retail sales increased 0.9% in December, the best gain in five months.

Auto sales rose 0.3% in December. Excluding car sales, seasonally adjusted retail sales rose 1.0% in December.

Gasoline sales rose 3.8% in December. This was the largest increase since April.

Economists were expecting a 0.7% gain for overall sales and 0.5% excluding autos. For all of 2006, sales increased 6.0%, down from a 6.9% gain in 2005. The figures are not adjusted for inflation.

Forex News: 12.01.2007 U.S. Dec. import prices rise 1.1%

Prices of goods imported into the United States climbed by 1.1% in December, led by big increases in the prices of imported petroleum and natural gas.

The December data follows a revised 0.5% gain in November and suggests some inflationary pressure from abroad. Imported petroleum prices rose by 4.8%, their biggest increase in seven months. Imported natural gas prices climbed by 10.1% in December.

Economists were expecting import prices to climb by 0.8% in December. Year-over-year, import prices have climbed 2.5%.

U.S. export prices increased in December by 0.7%

Forex News: 12.01.2007 NorthFinance: U.S. Federal budget will affect the dollar trend

"U.S. federal budget is the most interesting news after ECB had decided to hold the rate steady yesterday. Growth of the figure in two times as compare with previous month is expected widely. The most optimistical forecasts intend to 40 bln. dollars", - Sergey Popov, NorthFinance financial analyst announced.

If the published federal budget below 11 bln. dollars, it can be expected a significant fall of the dollar to other exchange pairs. Possibly, the deficit of budget will narrow slightly. It is caused by seasonal fluctuations, including warm winter period and falling of gasoline prices.

Another one interesting news is the U.S. retail sales index. The growth of the figure is expected following Christmas sales and huge amount of purchases. Import-export prices will remain steady and can not cause special interest.

Monday, January 08, 2007

Forex News: 08.01.2007 Retail sales index in Germany in November were below expectations

Despite positive expectations of the analysts, the index of retail sales in Germany dropped a second month, the Federal Statistical Office of Germany reported today.

The index was -0.3%, against -0.2% in October. At the annual rate, the index of retail sales rose from -0.8% in October to -0.5% in November. It was expected that the index would amount to +1.2% and +0.3%, in a month and year respectively.

As a rule, the index produces limited effect upon the market, largely, in middle- and long-term rate, but its unexpected drop may negatively influence German currency

Saturday, January 06, 2007

Forex News: 05.01.2007 U.S. December payrolls rose to 167,000

Nonfarm payrolls in the United States unexpectedly rose in December by 167,000 and the jobless rate remained at a very low 4.5%, the Labor Department reported.

Job growth was much stronger than the 100,000 expected. Payrolls grew by 1.84 million in 2006, an average of 153,000 per month.

The jobless rate fell from 4.9% at the beginning of the year to 4.5%. Average hourly earnings in December jumped by 8 cents or 0.5%.

Forex News: 05.01.2007 Business climate indicator rose by 1.6 points in the euro area in December

The business climate indicator was in the euro area 1.6 points in December, compared with 1.55 points in November, the European Commission said today. Thus, the index of business climate achieved its record maximum in December.

It is important to note that the index was above analysts’ expectations, who forecasted its drop by 1.54 points.

The component of consumer confidence rose to -6 points in December, from -7 points in November.

Economic expectations in manufacturing and services sectors did not change. The indexes were +6 points and +19 points respectively.

Forex News: 05.01.2007 Euro zone producer prices remain flat in November

Prices of products have remained unchanged in November, as energy prices decreased for the third month in a row.

Producer prices index stayed on its October level, while they grew 4.3% in the last twelve months, as the latest monthly report from the European Statistics Office shows. The monthly performance was expected by the economists.

Energy prices fell 0.3% from October, while they increased 6.9% in the last twelve months. Durable goods remained flat after having risen 0.2% in October.

Excluding energy, prices rose 0.1%. The annual rate of inflation decreased to 3.5% from 3.6% in October.

Forex News: 05.01.2007 The economic sentiment index was slightly down in the euro area in December

The economic sentiment index in the euro area was below expectations, dropping to 110.1 in December, from 110.3 in the preceding month. It was expected that the economic sentiment index, indicating the confidence of firms and consumers in the economic situation in the euro area, would amount to 110.4 points in December.

It is important to note that, despite economic sentiment drop in December, the index keeps the highest level in six years, reflecting fast economic growth, growing consumer demand and exports boost.

High level of companies’ confidence in current economic situation found reflection in larger investment and new jobs, which, in its turn, reduced unemployment rate.

Wednesday, January 03, 2007

Forex News: USD Weighed following ADP

The US economy remains the primary focus among currency traders at the start of the New Year with the data calendar beginning in earnest on Wednesday. With US stock and bond markets closed on Tuesday in observance for a National Day of Mourning, the release of manufacturing ISM was postponed until today. The December report is expected to reveal an improvement in manufacturing activity back to the key 50-level -- which distinguishes between expansion and contraction, from last month, which contracted to 49.5. Meanwhile, construction spending for November is forecasted to improve slightly from the prior month’s 1.0% decline, slipping by 0.5%.

The dollar’s direction will largely continue to be dictated by sentiment over the direction of global interest rate differentials – which ultimately hinge on Fed policy and the US economy. Dollar bears anticipate the Fed will ease policy in Q1 as a result of further deterioration in both housing and manufacturing to the extent of spillover into other sectors of the economy. On the other side of that coin, if incoming economic data reveals a bottoming in the housing market, steady pickup in manufacturing and continued improving conditions in the labor market, a Fed rate cut would be delayed until the second half of the year – thereby providing support for the greenback.

Forex News: 03.01.2007 ILO unemployment rate was down in Germany in November

Happy New Year !!!

The German labor market saw positive changes due to general economic growth and unusually warm weather. This is shown in the ILO labor market survey, released today by the Federal Statistical Office in Germany.

The number of unemployed was 3.0bln in November, down by 500.000 on a year earlier (-14.4%). At the annual rate, the unemployment rate was 7.0%, compared with 8.2% in November 2005.

When seasonally adjusted, the number of employed was up by 46.000mln, compared with the preceding month. The number of employed was up by 418.000 (+1.1%), compared with November of the previous year.