Strong Chinese Exports Cause Aussie Dollar to Soar

Yesterday’s price action in the currencies versus the dollar was a drag, man… We did, however, see the higher yielding currencies begin to move away from the pack of currencies led by the euro (EUR). That move higher by the likes of Australia (AUD), Brazil (BRL), South Africa (ZAR), and others, carried over through the overnight sessions, so, as we start today, they are stronger versus the dollar… In fact, the Aussie dollar is near a 7-week high this morning.

US Credit Rating: Who Will be the First to Downgrade?

During World War II, there was a saying, that, “loose lips, sink ships”… I think Greek Prime Minister, George Papandreou, should have taken those words to heart yesterday… You see, the currencies, led by the beleaguered euro (EUR), were rallying, and the single unit was nearing 1.37, when Papandreou made a statement that sunk the rally’s ship… He said, “Greece’s debt problems could soon spread to the rest of Europe and mean a weaker euro”

Greek Spending Cuts Lead to Civil Unrest

What a day the currencies had yesterday! The euro (EUR) gained ground all the way back to 1.3730 (but saw some profit taking at the end of the day) and all the other currencies followed in step… Now… There’s two ways to look at this… Either the euro is like a star that’s getting ready to burn out… (It always shines brightest before it burns out), or… It’s like a star that had been covered up by another planet, and is coming back into view!

GDP and Dollar Growth: It’s All Happening in Australia

I have to say front and center this morning, that while it may have taken the currency traders half a day to realize that Australia had raised rates, they finally began pushing the Aussie dollar (AUD) higher versus the green/peachback. I was beginning to think that I would have egg all over my face again, when the Aussie dollar didn’t respond right away… But it was all right on the night.

Canadian Dollar More than Just a Commodity Currency

I like the Canadian dollar (CAD) more and more. It has some fundamentals that are definitely improving, and some other aspects that are definitely worth considering. Here’s why…

Traditionally, the loonie has been linked with the Australian (AUD) and New Zealand dollars (NZD). Now in the current market, currencies are often linked together by at least one of three elements: They either produce a high yield, they are commodity-based or they are funding currencies for a carry trade.

Dollar Falters Overnight on Interest Rate Speculation

It can be a struggle to find things to write about when the markets aren’t moving much. That has been the case with the currency markets over the past few days, as the dollar has been trading in a fairly tight range. It felt like the dollar had the possibility to break out of this range yesterday, as we got a couple of different reports that looked to push the dollar higher.

Japanese Investment Trusts To Buy Aussie Dollars?

Front and center this morning consumer prices rose 0.2% in January, equaling the increases in December and November. Market expectations going into the report had been for a slightly larger 0.3% rise. Core prices surprisingly fell 0.1% in January following the 0.1% rise recorded in December and the flat reading in November. On a year-over-year basis, the overall CPI index rose 2.6% in December.

German Investor Confidence Declines

Remember last week, when I told you about the 10-year Treasury auction results? I told you that the yield had to be driven higher by 7 BPS to attract investors… Well, that’s cotton candy compared to the news from the 30-year Treasury auction!

Let me put this as simply as possible… “Indirect buyers” are the foreign central banks, and they normally take down 40% of a Treasury Issue… Well, last week, they only took down 28% of the issue… Uh-Oh! But then, there were the “direct buyers” upping their participation in the auction to a record level of 24%!

Eurozone Economy Stumbles and Fumbles

Front and center this morning, the non-dollar currencies led by the euro (EUR), are sliding against the dollar… Yesterday, the currencies range-traded all day, and in the overnight Asian session that pattern remained tight… But in the European session this morning, as economic growth in the Eurozone slowed in the fourth quarter of 2009, only one of the currency area’s four largest economies expanded.

Big Ben Bernanke Talks Rate Hikes

OK… Well, the “experts” that thought the trade deficit was going to narrow in December got their lunch handed to them yesterday, when not only did the trade deficit NOT narrow, but widened from $35 billion to $40 billion! Now that stinks! And… I’ll tell you right now, it will deduct from the 5.7% GDP figure that was printed a couple of weeks ago. Yes, this increase in the trade deficit will probably reduce the GDP figure to at least 5%.

Germany Weighs Possible Bailout of Greece

There are rumors going ’round that, 1. There is a secret central bank meeting going on, and 2. That Germany is weighing bailout possibilities for Greece…

The latter really lit a fire under the risk assets yesterday, allowing stocks, currencies and commodities to enjoy a day in the sun, away from the shade the dollar was casting on the risk assets. Stocks turned around and had a strong showing for the day, gold was up $15, and currencies, led by the Brazilian real (BRL) gained back some precious ground versus the dollar. I know that sounded a little strange saying, “led by the Brazilian real” as I normally associate the currencies being “led by the euro”…

Stop Deficit Spending. Save the Credit Rating.

Front and center this morning, the non-dollar currencies have seen some healing… Not much, but some… But these mini-rallies are on tenterhooks, folks; they can be reversed in a New York Minute… And, now that I look back at the screens, that’s exactly what’s happening! UGH! These turn-arounds are beginning to give me a rash!