Yen Gives Up Yesterday's Gains as New Deal for Lehman Boosts Risk Appetite
Fundamental Archives |
Written by CMS Forex |
Sep 12 08 20:52 GMT |
Yen Gives Up Yesterday's Gains as New Deal for Lehman Boosts Risk Appetite
NZ Retail Sales Declines 0.8%
In New Zealand retail sales declined 0.8% in July, nearly wiping out the growth seen in June. The number disappointed forecasts. Core sales were down a more tepid 0.2%.
JPN GDP 2nd Quarter GDP Revised Down
In Japan, 2nd quarter GDP was revised down to show a 0.7% decline, which matched forecasts. The annualized rate now shows a 3.0% fall. That's a big downward revision from the advance estimate of 2.4% and is the steepest contraction since 2001.
JPN Industrial Production Up in August
Industrial production in Japan surprised forecasts on the upside, increasing 1.3% in August. On the year, production is now 2.4% higher. Shipments were up 1.9% while inventories declined slightly.
NZD/JPY - Kiwi Rebounds From Support at 68.50
Asian equity markets rebounded overnight and the Kiwi-Yen pair rose almost 300 pips from yesterday's low at 68.50. News that another deal was in the works for Lehman Brothers helped quiet the storms in equity markets and increased risk appetite going into the weekend.
EUR Industrial Output Declines 0.3%
In the Euro-zone, production fell for the 3rd straight month in July, declining 0.3% which was lower than forecasts. June's figure was revised down and on the year, production is 1.7% lower.
EUR Employment Growth up 0.2% in 2nd Quarter
Euro-zone payrolls grew by 0.2% in the 2nd quarter compared to the 1st quarter. On the year employment change cooled to 1.2% from the 1.6% seen in the previous report. That is the slowest pace since the 4th quarter of 2005.
EUR/JPY - Euro Rallies 480 Pips vs Yen as European Stocks Rise
European stocks were positive on the day, snapping their losing streak and injecting some life into the beleaguered Euro. After sliding to 147.40 yesterday, the Euro-Yen pair jumped 480 pips as investors covered their short positions going into the weekend.
US Retail Sales Down Sharply
In the US, retail sales fell a second straight month in August, coming in below expectations. Sales were down 0.3% for the month, and July's figure was revised modestly down to show a 0.5% fall. One factor was a decline in gasoline prices which brought down spending on fuel.
US Producer Prices Fall A Sharp 0.9%
US producer prices saw a sharp drop in August, falling 0.9%, as energy and commodity prices eased. That was the biggest monthly drop in nearly 2 years, and helped bolster the case that inflation should begin moderating in the months to come. Core prices however met forecasts of a 0.2% increase.
US Business Inventories Rise More Than Expected
US inventories rose 1.1% in July, almost double the forecast rate, as companies seem to be getting stuck with unwanted goods amid a softening economy.
US UMich Consumers More Optimistic in Sept
The mid-September UMich consumer sentiment index jumped to 73.1, surprising forecasts on the upside. Both the current conditions and future expectations indexes rose, while both the 12-month and 5-year inflation forecasts fell.
EUR/USD - Euro Rallies From 1 Year Low
After hitting a one-year low yesterday near 1.39 the Euro-Dollar pair climbed almost 280 pips. Speculation spread that the Fed's next move may be to lower rates, instead of raising them as had been the conventional wisdom when inflation was the main problem, and so the Dollar was pressured.
GBP/USD - Pound Soars 450 Pips vs Greenback to End the Week
The Pound-Dollar pair soared 450 pips as Lehman Brothers negotiated with potential buyers, encouraging investors to reduce bets against higher-yielding assets, such as the Pound.
USD/CAD - Loonie Gains 200 Pips After Testing 1-Year High
The US Dollar-Canadian Dollar fell almost 200 pips after setting a high near 1.08 yesterday. Oil, gold and other commodity prices increased today and boosted the Loonie's prospects. It will be interesting to note next week if this contraction seen in Dollar crosses will be short-lived.
Next Week: US Releases
Taking a look at some upcoming releases from the US, we have the FOMC decision on Tuesday. It is expected to hold rates at 2%. Consumer prices come out the same day, and other US releases during the week include Industrial Production, the Empire and Philly Indexes, TIC Flows, Housing Starts and Permits.
Next Week: European Releases
In Europe, the Swiss National Bank will decide on rates on Thursday, and they are expected to hold at 2.75%. Data from UK includes CPI, the Claimant Count, the BOE Minutes, and Retail Sales. The Euro-zone and Germany put out final versions of CPI and the ZEW Economic Sentiment.
