FOREX TRADING

The pessimism driving bond yields to record lows recently was served a reality check in the shape of an unexpectedly bullish Chicago Fed manufacturing PMI reading. Ever since the FOMC aired the notion of resuming its asset purchase plan two weeks ago, investors have warmed to risk appetite seemingly assured

The debate over the need for further quantitative ease continues to grab headlines. Into the cauldron go the views of the Boston Fed’s Rosengren, those of Philadelphia’s Plosser with those of Bank of England member Adam Posen on the other side of the Atlantic thrown into the mix. The uncertainty

The GBP/CHF is much like the USD/CHF in that it is testing a 2009 low while the USD/CHF is testing the 2008 low. In the weekly chart, the GBP/CHF appears to have broken below an important support at 1.5580. This break suggests the pair is heading to the 2009 low

The dollar is down Thursday as better-than-expected U.S. data did little to convince investors that the health of the economy is improving. Gross domestic product grew at a 1.7% annual rate April through June, the Commerce Department said. This is slightly better than the 1.6% rate economists had expected. Initial

The USD weakness shows no signs of fading despite two important Fed officials out yesterday pooh-poohing any potential for QE 2 to move the economy in the right direction. Kocherlakota who will become a voting FOMC member in 2011 said that the ability for QE2 to raise inflation

After powering through the first year of recovery, the Canadian economy has lost some footing heading into the second half of 2010. Real GDP fell 0.1% in July, the first monthly decline in almost a year. The weakness was largely widespread with output in all but a few industries declining

Really, that’s what this Eurozone fiasco has morphed into – quiet desperation. Officials — whether those heading up Eurozone member countries, the IMF, the EU or the ECB — are all holding their breath and hoping that something they do, some of their economy-restoring and debt-reducing strategies, actually sticks.

The third and final estimate of second-quarter 2010 annualized GDP growth was revised up to 1.7% from the second estimate of 1.6% (and the advance estimate of 2.4%). Markets had expected no change from the second estimate going into today’s report. The second-quarter increase represents a slowing from gains of

GDP output in July dropped an expected 0.1% in the month, following gains of 0.2% and 0.1% in June and May, respectively. The weakening although modest was broadly based with both goods-producing and service-producing industries declining 0.1% in the month. Market expectations of a 0.1% drop in July GDP were

Cable moved up to test the Resistance at 1.5900-25 and has again come to trade below 1.5900. In the coming sessions over today and tomorrow, we see chances of the pair moving up towards 1.5950-70, after coming down towards 1.5840-20 in the US session today. Though, the chances of a

The fear is outright that Europe will experience slower growth and the worry has not been eased by the widespread demonstrations yesterday in most European capitals against cut backs in public spending. The electorate in Europe seems to be out of sync with reality and you should expect more strikes

Data released overnight suggest that the recovery in manufacturing activity is losing a considerable amount of steam. Industrial production in August fell by 0.3% m/m (consensus: +1.1% m/m) and according to production plans Japan’s manufacturers plan to cut production further in the coming months. For Q3 as a whole, industrial

Price hesitation may have ended as the pair is now seen reversing most of its corrective losses in early trading today. This development has left GBP targeting the 1.5996 level, its Aug 08’10 high. A clean penetration of there will resume its short term uptrend towards the 1.6274 level, its

Euro shrugged off peripheral debt concerns and continues its rally against the greenback at 1.3666 currently boosted by encouraging German data. The bad news over Anglo Irish costs, the majority stake of Irish govt in Allied Irish bank and the downgrade of Spain by Moodys had been largely priced in

Ireland’s central bank has put a EUR29.3bn (18% of GDP) price on bailing out Anglo Irish Bank in a base-case scenario, and EUR34bn (21% of GDP) under a worst-case scenario. These are huge numbers, but pretty much in line with expectations. S&P had estimated that losses could reach EUR35bn. But