The currency markets rode out the rough waters of Wednesday and made it to a bit calmer seas yesterday. The dollar traded in a fairly tight range as reports released in the morning showed initial jobless claims remained just over 350,000, and continuing claims also remained steady. Both of these numbers were slightly better than estimates, but neither moved the markets.
[Read more...]The Greek Parliament Bails Out the Markets
February 13, 2012 By Leave a Comment
The Greek Parliament approved the austerity measures yesterday, giving traders the confidence to head back into the markets. We will have a fairly big week of economic data releases here in the U.S., which should help keep things interesting. Lots to cover, so I better get going if I am going to get this delivered on time!
[Read more...]Central Banks Pump Dollar Liquidity into the Markets
November 30, 2011 By Leave a Comment
The dollar continued on its decline through most of the trading day yesterday, but fell off a cliff in very early European trading. A coordinated central bank action to lower swap rates was the reason for the dramatic moves in the currencies this morning. The FED, ECB, BOJ, SNB, BOC, and BOE all agreed to cut the cost of providing dollar funding via swap arrangements. They also agreed to make other currencies available as needed, but the primary function of these swap arrangements was to push more dollar liquidity into the markets. Swap agreements give the banks US dollars today for euros or other currency payments at some future date. It effectively pumps fresh US dollars into the markets which will be pulled back out at some point in the future. The move was seen as necessary in order to prop up the European banks which have been hard hit by the euro financial crisis. The additional liquidity was welcomed by the markets, with the European stock markets and early US markets up nicely.
[Read more...]EU Pushes for a More Perfect Fiscal Union
November 28, 2011 By Leave a Comment
The news wires are all about Europe again this morning. The euro (EUR) has picked up some of the ground it lost versus the US dollar last week on speculation European leaders will be able to agree to take some additional steps to stem the region’s debt crisis. German Finance Minister Wolfgang Schaeuble pushed for changes to the EU treaty which will tighten fiscal requirements. I really don’t think the EU will need to make any changes to the treaty, but should simply push countries to adhere to the fiscal standards required in the existing EU treaty.
[Read more...]Greek and Italian Turmoil Negatively Affect the Euro
November 9, 2011 By Leave a Comment
Right off the bat, this is going to be super short and sweet this morning as Chuck was feeling under the weather last night and asked me to step in with some of the market headlines from this morning and last night. The market moving headlines yesterday and through today so far have been primarily European in nature, as Italy is beginning to steal the spotlight away from Greece in the debt crisis du jour. Since Italy is a bigger fish in the Eurozone than Greece, the levels of concern have been on the rise.
[Read more...]The Fed Chooses Operation Twist
September 22, 2011 By Leave a Comment
Well… It looks as though that perfect storm I talked about two weeks ago, has hit the shoreline… The Fed is out on the dance floor twisting the night away, and home prices continue to decline… But… The dollar is rallying this morning, folks… Strange but true!
Yes, the perfect storm that was brewing for a dollar rally, and short term period of dollar strength, hit the shoreline last night… And the dollar is in the driver’s seat this morning… I guess, the overnight markets believe that the Fed’s latest, greatest, move to stimulate the US economy will work, and everyone will want to own dollars going forward… Hmmm… I’m not buying that… But apparently someone is, because the currencies have a look about them this morning that they haven’t been seen with in some time!
[Read more...]China Contemplates More Investment
September 13, 2011 By Leave a Comment
Well… The death watch for Greek debt continues… I saw one pundit say yesterday that a Greek default wasn’t a question of “if” but “when”… The markets are convinced that Greece and the European Union have no way out of this but to default. The Eurozone leaders are still trying to hang on to the 10% chance that Greece won’t default, and good for them… It would do no one any good for them to throw in the towel when there’s still a chance… Unfortunately, the chances are slim and none…and slim left town!
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Fed Meeting Spillover Aids US Dollar Strength
Good day and welcome to another Thursday. We saw another summer-like day here in the Midwest that lends itself to throwing the winter coat toward the back of the closet and forgetting about it until next winter. While it’s still way too early to take such drastic action, investors have seemingly thrown the debt problems and other fundamental concerns about the U.S. economy to the back of the closet, hidden under that shirt you got as a birthday gift years ago that was never returned.
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