Analytics, News, and Forecasts for CFD Markets: currency news — 14-02-2013.

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14.02.2013

19:20

American focus: the euro has declined substantially

The euro fell to a three-week low against the dollar after a report showed that the decline in the euro area has increased in the fourth quarter, more than expected, undermining demand for assets in the region and to encourage the retention of interest rates at low levels.

The single currency also fell against the yen as separate data showed that gross domestic product fell in Germany and France.

The euro also fell after the vice-president of the European Central Bank's Vitor Constancio said the ECB is technically ready for the negative interest rate on deposits in case of need. Recall that the ECB deposit rate is now zero. The central bank usually change their rates three together, so any reduction in rates by 25 basis points could lead to a reduction in deposit rates to 0.25%, which will reduce the attractiveness of the euro.

The dollar rose, helped by the reported data on the number of initial claims for unemployment insurance, which showed a larger than expected decline. According to the U.S. Department of Labor, for the week of February 10, the number of Americans who first filled out a form to apply for unemployment benefits fell by 27 thousand to 341 thousand - 360 thousand lower than forecast and the revised value for the previous week to 368 thousand

The four-week moving average of initial claims, which smooths out weekly volatility, rose by 1,500 to 352,500. Despite a slight increase in the last week, the average rate remained at five-year low.

The yen rose against most major currencies, after the Russian finance minister said that the G20 group should take a tougher stance on currency manipulation.

The New Zealand dollar rose against the U.S. dollar while still achieving the highest level in the last 17 months, after data showed that the index of business activity in the manufacturing sector rose sharply in January, while still achieving the level of 55.2, which is the maximum with June 2010. Note that such positive data significantly increase the chance that the central bank will raise its level of interest rates.

18:20

European stocks close

Most European stocks declined as reports showed the economies of the euro area and Japan shrank in the fourth quarter, outweighing a decrease in American jobless claims.

The Stoxx Europe 600 Index retreated 0.2 percent to 287.79 at the close, paring an earlier drop of as much as 0.6 percent, as releases showed the economies of Germany, France and Italy all contracted more than estimated.

Euro area gross domestic product fell 0.6 percent in the fourth quarter from the previous three months, the European Union’s statistics office in Luxembourg said. That exceeded the 0.4 percent median estimate. The German economy, Europe’s largest, shrank 0.6 percent in the fourth quarter, while French GDP fell 0.3 percent. Italy’s economy shrank 0.9 percent. All contractions exceeded the median forecasts of economists. In Japan, GDP dropped an annualized 0.4 percent, following a revised 3.8 percent decline in the previous quarter, the Cabinet Office said. The median forecast of economists called for 0.4 percent growth.

National benchmark indexes fell in 13 of the 18 western European markets.

FTSE 100 6,327.36 -31.75 -0.50% CAC 40 3,669.6 -28.93 -0.78% DAX 7,631.19 -80.70 -1.05%

Nestle dropped 2.3 percent to 63 Swiss francs. The company said its sales excluding acquisitions, disposals and currency changes increased 5.9 percent in 2012. That was less than the 6 percent average estimate of analysts.

Britvic Plc lost 7.1 percent to 390 pence, a 10-week low. The U.K. distributor of Pepsi was downgraded at Societe Generale SA, JPMorgan Chase & Co. and Barclays Plc. A.G. Barr Plc called off its planned acquisition of Britvic yesterday after the Office of Fair Trading referred the deal to the Competition Commission.

Bankia SA, the lender recently ejected from Spain’s benchmark IBEX 35 Index, slumped 12 percent to 41 euro cents. The bank will convert bonds to equity at 1 euro cent per share as part of its reorganization, Expansion reported.

Renault advanced 7.7 percent to 46.50 euros, its biggest gain since September 2011. France’s second-largest carmaker said earnings before interest, taxes and one-time items totaled 729 million euros ($971.5 million). That beat the 698 million-euro average estimate.

ABB rose 5.6 percent to 20.81 francs, its biggest advance in 18 months, after reporting earnings that surpassed analyst estimates. The world’s largest maker of power transformers said it will continue to focus on cutting costs this year amid an uncertain economic outlook.

BNP Paribas SA gained 2 percent to 46.75 euros. The bank plans to reduce its annual cost base by 2 billion euros by 2015. BNP plans to increase its dividend to 1.50 euros a share from 1.20 euros a year earlier.

13:51

U.S. jobless claims down 27,000 last week

The number of U.S. workers filing new applications for unemployment benefits fell significantly last week, the latest signal that the labor market is improving.

Initial jobless claims, a measure of layoffs, decreased by 27,000 to a seasonally adjusted 341,000 in the week ended Feb. 9, the Labor Department said Thursday.

Economists surveyed by Dow Jones Newswires had forecast 360,000 new applications for jobless benefits last week. Claims for the prior week were revised up to 368,000 from an initial estimate of 366,000

The four-week moving average of claims, which smoothes out week-to-week volatility, advanced by 1,500 to 352,500. Despite the slight rise last week, the average level remained near a five-year low.

A Labor Department analyst said figures were estimated for Illinois and Connecticut, the later due the recent snow storm that prevented state employees from reporting to their offices. The analyst, however, said the snow, which fell late in the week, likely had little impact of the number of claims filed to the state because most are sent via telephone or the Internet.

The number of new claims has fallen in four of the past five weeks. The downward trend points to slow but steady job growth. Hiring typically picks up when layoffs decline.

Earlier this month, the Labor Department said employers added 157,000 jobs in January, and revised data showed job growth in 2012 was better than first reported.

Still, the unemployment rate, obtained by a separate survey of U.S. households, moved up one-tenth of a percentage point to 7.9% last month, in part because the labor force is growing.

Thursday's claims report showed the number of continuing unemployment benefit claims--those drawn by workers for more than a week--decreased by 130,000 to 3,114,000 in the week ended Feb. 2. That's the lowest level since July 2008. Continuing claims are reported with a one-week lag.

The number of workers requesting unemployment insurance was equivalent to 2.4% of employed workers paying into the system in the week ended Feb. 2, down from 2.5% the prior week.

13:40

Option expiries for today's 1400GMT cut

EUR/USD $1.3300, $1.3350, $1.3370, $1.3400, $1.3425, $1.3450, $1.3460, $1.3500

USD/JPY Y93.00, Y93.50, Y93.55, Y93.75, Y94.0

GBP/USD $1.5500, $1.5630, $1.5685, $1.5700

AUD/USD $1.0320, $1.0325, $1.0350

AUD/JPY Y95.60

13:30

U.S.: Initial Jobless Claims, 341 (forecast 361)

13:24

European session: the euro declined

06:30 France GDP, q/q (preliminary) IV quarter +0.1% -0.2% -0.3%

06:30 France GDP, Y/Y (preliminary) IV quarter 0.0% -0.2% -0.3%

07:00 Germany GDP (QoQ) (preliminary) IV quarter +0.2% -0.5% -0.6%

07:00 Germany GDP (wda) (YoY) (preliminary) IV quarter +0.4% +0.2% +0.4%

07:45 France Non-Farm Payrolls (preliminary) IV quarter -0.3% -0.2% -0.2%

09:00 Eurozone ECB Monthly Report February

10:00 Eurozone GDP (QoQ) (preliminary) IV quarter -0.1% -0.4% -0.6%

10:00 Eurozone GDP (YoY) (preliminary) IV quarter -0.6% -0.7% -0.9%

The euro fell sharply against the dollar after the release of the preliminary report on the euro area GDP, were worse than expected. In the 4th quarter Eurozone GDP has accelerated the rate of decline from the preliminary -0.6% to -0.9% in annual terms compared with an expected 0.7%. In the quarterly equivalent index fell by 0.6% vs. -0.4%.

In the 4th quarter of 2012, gross domestic product / GDP / eurozone contracted at the fastest pace in nearly four years. Weakening global economic activity and the deep recession, recorded in the southern eurozone countries had a negative impact on these engines of economic growth, such as Germany and France.

In Germany, in the 4 th quarter GDP fell by 0.6% q / q St. after growth of 0.2% in the previous quarter and the forecast of -0.5%. The annual equivalent of NSW. rose by 0.1%, slowing down against the result of +0.4% in Q3. and fell short of the forecast +0.2%. In France, the economy contracted by 0.3% q / q. In Italy, the economy has picked up the baton and declined in Q4. by 0.9% q / q vs. -0.6%. The annual rate fell by 2.7% against prev. -2.4%.

The ECB has warned that strengthening of the euro could reduce the rate of inflation for the target mark of the Bank. As an upside inflation risks were identified increase in administered prices and indirect taxes, and the price of oil, while the downside risks to the Bank considered the economic slowdown and the strengthening of the single currency, noted recently. The ECB expects the region's economy will start to recover later this year.

The yen is trading sideways against the dollar, as investors reacted to the decision by the Bank of Japan kept monetary policy unchanged and consider further support for the Japanese economy in the coming months due to the ongoing recession in the country. Also today, the data released by Japan, which recorded that the economy is in the 4th quarter. 2012 was not able to get out of recession. In annual terms, the Japanese economy on the basis of the last three months of 2012 decreased by 0.4%. Analysts had expected with growth of 0.1% compared to the third quarter and 0.4% year on year.

EUR / USD: during the European session the pair fell to the low of $ 1.3314

GBP / USD: during the European session the pair fell to the low of $ 1.5493

USD / JPY: during the European session the pair is trading in the range of Y93.08 - 72

In the U.S. at 13:30 GMT will the number of initial claims for unemployment insurance, the number of repeated applications for unemployment benefits. At 21:45 GMT New Zealand will publish the change in retail trade, including excluding vehicle sales for the 4th quarter.

13:05

Orders

EUR/USD

Offers $1.3420/30, $1.3400

Bids $1.3310/00, $1.3290, $1.3280, $1.3250

GBP/USD

Offers $1.5650, $1.5600/10, $1.5585, $1.5550

Bids $1.5490/85, $1.5460/50, $1.5400/390

AUD/USD

Offers $1.0450, $1.0415/20, $1.0400, $1.0380/85

Bids $1.0310/00, $1.0295/90, $1.0270/65, $1.0250, $1.0240/35

EUR/JPY

Offers Y126.50, Y126.30, Y125.95/00, Y125.50/55, Y124.90/00

Bids Y124.20, Y124.00, Y123.50, Y123.10/00, Y122.80

USD/JPY

Offers Y94.50, Y94.25/30, Y93.90/00, Y93.80

Bids Y93.20/10, Y93.00, Y92.85/80, Y92.70, Y92.60/50, Y92.40/35

EUR/GBP

Offers stg0.8770/75, stg0.8720, stg0.8685/90

Bids stg0.8570, stg0.8545/40, stg0.8520/15

10:30

Option expiries for today's 1400GMT cut

EUR/USD $1.3300, $1.3400, $1.3500, $1.3550

USD/JPY Y92.00, Y93.00, Y93.50, Y93.55

GBP/USD $1.5630, $1.5685, $1.5700

AUD/JPY $1.0320, $1.0325

AUD/JPY Y95.60

10:00

Eurozone: GDP (QoQ), IV quarter -0.6% (forecast -0.4%)

10:00

Eurozone: GDP (YoY), IV quarter -0.9% (forecast -0.7%)

09:04

Forex: Wednesday’s review

The euro fell against most major currencies after a published report showed that the unemployment rate in Portugal rose in the fourth quarter to 16.9%, compared with 15.8% in the third quarter, the highest value since the creation of the euro area. Recall that in the fourth quarter of 2011 the unemployment rate was 14%. The data also showed that the number of unemployed in the country for the year rose by 19.7% per year to 923 200. Meanwhile, the number of employed persons decreased by 4.3% to 4.53 million.

The yen traded little changed against the dollar and the euro after sharp movements in the previous session. It is believed that investors cut bearish positions in the yen after an official statement from the Group of Seven countries in which concern was expressed about the excessive movements in the currency of Japan. G7 official representative said that the statement of the group was to signal the concerns about excessive depreciation of the yen. However, economists point out that, in general, no words G7 will not change the basic predictions for the Japanese currency market, and no one expects that the yen could go back to the previous range against the dollar at the 80th figure. Investors are also likely to show caution before the results of the meeting of the Bank of Japan, which ends on Thursday, although many expect that the bank will refrain from any further until the mitigation measures.

The pound fell after the Bank of England said risks to the recovery of the UK economy have been weighted to the downside. The British pound came under heavy pressure after the Bank of England released a quarterly report on inflation, and after the show the head of the Central Bank Governor Mervyn King. The report of the Bank of England reported that UK GDP will remain below pre-crisis levels until 2015, and the CPI will exceed the target mark in the next three years. Head of CB King believes that restoring the UK economy will go more slowly, and that further monetary stimulus will support only market optimism, but not growth. The pound fell to a six-month low against the dollar after the King spoke of the need for further measures to stimulate foreign demand, while hinting that further currency depreciation would help improve the situation.

07:45

France: Non-Farm Payrolls, IV quarter -0.2% (forecast -0.2%)

07:03

Asian session: The yen halted a two-day advance

00:00 China Bank holiday -

03:00 Japan BoJ Interest Rate Decision - 0.10% 0.10% 0.10%

03:00 Japan BoJ Monetary Policy Statement -

06:00 Japan BOJ Press Conference -

The yen halted a two-day advance as investors overlooked the Bank of Japan’s decision to keep its asset purchases unchanged and speculated the central bank will add stimulus next month as the nation’s economy slows. The yen fell after former BOJ Deputy Governor Kazumasa Iwata, a potential candidate to become the next central bank head, signaled the currency has scope to depreciate further.

Data showed today Japan’s gross domestic product unexpectedly shrank in the fourth quarter. Gross domestic product contracted an annualized 0.4 percent, following a revised 3.8 percent fall in the previous quarter, the Cabinet Office said in Tokyo today. The median forecast of 32 economists surveyed by Bloomberg News was for 0.4 percent growth. Nominal GDP shrank 0.4 percent on quarter.

New Zealand’s dollar, nicknamed the kiwi, rose for a third day after figures showed the nation’s manufacturing industry grew at the fastest pace since May. New Zealand’s PMI increased to 55.2 in January from a revised 50.4 in December, Business New Zealand and the Bank of New Zealand Ltd. said in a statement released in Wellington. A reading over 50 signifies expansion.

EUR/USD: during the Asian session, the pair traded in the range of $1.3440-50.

GBP/USD: during the Asian session the pair fell updating week’s low.

USD/JPY: during the Asian session, the pair rose to Y93.60.

The data calendar gets underway early Thursday, with the release of the French fourth quarter flash GDP data. There is further French data at 0730GMT, with the release of the January BoF retail survey. Also at 0900GMT, the ECB is set to release its latest monthly report, which is unlikely to vary much from President Draghi's opening statement at the recent press conference. Following The release of national GDP data, the overall EMU Q4 numbers are set for release at 1000GMT. At 1100GMT, the European Commission is set to present proposals for a tax on financial transactions in 11 EU member states.