Analytics, News, and Forecasts for CFD Markets: currency news — 20-09-2012.

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20.09.2012

17:54

American focus: euro fell

The euro dropped the most in two months against the dollar as services and manufacturing in the region shrank to a three-year low, adding to evidence the central bank will need to do more to spur growth.

The yen and the dollar strengthened against most of their major counterparts as demand for the perceived safety of those nations’ assets increased after separate reports showed China’s manufacturing and Japanese exports declined for a third month.

A preliminary reading was 47.8 for a China purchasing managers’ index released today by HSBC Holdings Plc (HSBA) and Markit Economics, compared with a final level of 47.6 last month. Japan’s overseas shipments slid 5.8 percent on weakness in demand from Europe and China.

The euro weakened against most of its 16 major peers even after Spain’s borrowing costs fell at a 4.8 billion-euro auction of three- and 10-year debt, the biggest since January. The sale came amid expectations the nation will ask the European Central Bank to buy its debt.

A composite index based on a survey of purchasing managers in euro-area services and manufacturing industries dropped to 45.9 for September, the lowest since June 2009, London-based Markit Economics said in an initial estimate. A reading below 50 indicates contraction.

Australia’s currency fell as the Chinese data clouded the prospects for the South Pacific nation’s resource exports.

14:00

U.S.: Leading Indicators , August -0.1% (forecast -0.1%)

14:00

Eurozone: Consumer Confidence, September -26 (forecast -24.0)

14:00

U.S.: Philadelphia Fed Manufacturing Survey, September -1.9 (forecast -4.1)

13:45

Option expiries for today's 1400GMT cut:

EUR/USD $1.2965, $1.2935, $1.2900, $1.2850

USD/JPY Y78.45, Y78.00, Y77.75

EUR/JPY Y100.70

GBP/USD $1.6200

EUR/GBP stg0.8030-35

USD/CHF Chf0.9500

AUD/USD $1.0415, $1.0445, $1.0475, $1.0500

13:00

U.S.: Manufacturing PMI, September 51.5 (forecast 51.5)

12:10

European session: the dollar rose sharply

Data
02:30 China HSBC Manufacturing PMI (preliminary) September 47.6 47.8
04:30 Japan All Industry Activity Index, m/m July +0.2% -0.5% -0.6%
05:00 Japan BoJ monthly economic report September
05:00 Japan BOJ Governor Shirakawa Speaks -
06:00 Switzerland Trade Balance August 2.92 1.17
06:00 Germany Producer Price Index (MoM) August 0.0% +0.4% +0.5%
06:00 Germany Producer Price Index (YoY) August +0.9% +1.5% +1.6%
07:00 France Manufacturing PMI (preliminary) September 46.0 46.5 42.6
07:00 France Services PMI (preliminary) September 49.2 49.5 46.1
07:30 Germany Manufacturing PMI (preliminary) September 44.7 45.4 47.3
07:30 Germany Services PMI (preliminary) September 48.3 48.6 50.6
08:00 Eurozone Manufacturing PMI (preliminary) September 45.1 45.4 46.0
08:00 Eurozone Services PMI (preliminary) September 47.2 47.4 46.0
08:30 United Kingdom Retail Sales (MoM) August +0.3% -0.4% -0.2%
08:30 United Kingdom Retail Sales (YoY) August +2.8% +2.9% +2.7%
10:00 United Kingdom CBI industrial order books balance September -21 -14 -8

The euro fell against the dollar due to the fact that the index of business activity in the euro area services sector fell to a three-year low. The composite index of purchasing managers in the services and manufacturing sectors in the euro area fell to 45.9 in September, registering the lowest since June 2009
The single currency has continued its two-day decline against the yen, as data added to evidence that the debt crisis in the euro area undermines growth.
The yen and dollar strengthened against most major currencies after a report showed that the level of production in China continued to decline along with the decrease in the volume of Japanese exports, stimulating the demand for safe assets.
Euro weakened against all but three of its 16 major counterparts, despite the fact that Spain's borrowing costs fell after the auction.
The dollar index (DXY) rose for the third time in four days after data from China and Japan, which showed that the Asian economy is slowing. The index added 0.6% and reached 79.55.
The Australian dollar fell as Chinese data clouded the prospects of export growth for the South Pacific Ocean.
The Swiss franc fell against the dollar amid the release of the trade balance, which recorded a decline in August to the level of 1.17 billion Swiss francs.

EUR/USD: during the European session, the pair quickly dropped, setting all-time low of $ 1.2925, and then increased slightly and is now trading at $ 1.2950
GBP/USD: the pair decreased to $ 1.6160, but then rose to the floor pieces, and is now at a value of $ 1.6190
USD/JPY: pair fell sharply, by setting a minimum level of Y78.03, followed by a correction, in which the rate rose to Y78.20

At 12:30 GMT the United States, there are data on the number of initial claims for unemployment insurance, the number of repeat applications for unemployment benefits and an index of business activity in the manufacturing sector in September. At 14:00 GMT Eurozone release Eurozone consumer confidence indicator for September. At the same time, the U.S. will release the manufacturing index, the Philadelphia Fed in September. At 16:00 GMT the euro area will be speech by ECB President Mario Draghi.

11:45

Orders

EUR/USD

Offers $1.3060, $1.3020/30

Bids $1.2930, $1.2900, $1.2855/50

GBP/USD

Offers $1.6300, $1.6280, $1.6270/75, $1.6220, $1.6200/05

Bids $1.6150/40, $1.6120, $1.6085/80, $1.6060/50

AUD/USD

Offers $1.0570/80, $1.0540/50, $1.0520, $1.0490/5.00

Bids $1.0350/40, $1.0168

USD/JPY

Offers Y79.50, Y79.30

Bids Y78.00, Y77.95/90, Y77.65/60

EUR/JPY

Offers Y103.80/4.00,Y104.00

Bids Y101.00, Y100.80/60, Y100.50

EUR/GBP

Offers stg0.8150, stg0.8070/80, stg0.8020

Bids stg0.7970, stg0.7945/40

11:30

ECB Ker: ECB bond purchases will keep the "unity" of monetary policy

Bond purchases do not mitigate credit conditions, but make them uniform
The ECB will stop buying bonds in case of breach of
Bond purchases involve strict conditions
Bond purchases by the ECB are not quantitative easing, there is no risk to the balance
Bond purchases will not lead to inflation
ECB bond purchases remain an incentive for economic reform
We intend to stick to our mandate to protect price stability
Do fears about the collapse of the euro zone is "huge" destructive potential
ECB bond purchases - a means to combat concerns about the possibility of the collapse of the eurozone

10:00

United Kingdom: CBI industrial order books balance, September -8 (forecast -14)

09:30

Option expiries for today's 1400GMT cut

EUR/USD $1.2965, $1.2935, $1.2900, $1.2850

USD/JPY Y78.45, Y78.00, Y77.75

EUR/JPY Y100.70

GBP/USD $1.6200

EUR/GBP stg0.8030-35

USD/CHF Chf0.9500

AUD/USD $1.0415, $1.0445, $1.0475, $1.0500

08:30

United Kingdom: Retail Sales (YoY) , August +2.7% (forecast +2.9%)

08:30

United Kingdom: Retail Sales (MoM), August -0.2% (forecast -0.4%)

08:21

Asian session: The euro fell

02:30 China HSBC Manufacturing PMI (preliminary) September 47.6 47.8

04:30 Japan All Industry Activity Index, m/m July +0.2% -0.5% -0.6%

05:00 Japan BoJ monthly economic report September

05:00 Japan BOJ Governor Shirakawa Speaks

The euro fell against the dollar and yen before data today forecast to show European services and manufacturing contracted, adding to evidence that the region’s debt crisis is sapping growth. A euro-zone composite index for services and manufacturing industries was probably at 46.6 in September, from 46.3 the prior month, according to the median estimate of economists surveyed by Bloomberg News before London-based Markit Economics releases the figure today. Readings below 50 signal contraction.

Spain, the fourth-largest economy in the currency bloc, will auction 3- and 10-year notes today. The nation’s benchmark 10-year yield has fallen to 5.7 percent from the euro-era record of 7.75 percent on July 25 since the European Central Bank unveiled an unlimited bond-purchase program on Sept. 6 aimed at lowering government borrowing costs.

Japan’s currency gained versus all of its 16 major peers amid speculation unexpected expansion of monetary stimulus by the Bank of Japan will do little to spur economic growth as a territorial dispute with China and weak global demand cloud the outlook for shipments.

Australia’s dollar sank after a private survey showed China’s manufacturing may shrink for an 11th month, dimming prospects for the South Pacific nation’s exports. In China, a preliminary reading today showed a gauge by Markit and HSBC Holdings Plc for manufacturing was 47.8 this month from 47.6 in August. China is Australia’s largest trading partner and New Zealand’s second-biggest export destination.

EUR / USD: during the Asian session the pair fell to the previous day's low.
GBP / USD: during the Asian session the pair fell below $1.6200.
USD / JPY: during the Asian session, the pair continued yesterday's fall, updating week's low.

A heavy data calendar Thursday, as the Eurozone flash PMI data are released. Ahead of the PMI, at 0600GMT, the German Germany August PPI numbers are released. As noted, today sees the release of flash manufacturing and services PMI data out of Germany and France, the Eurozone's first and second largest economies. The French France August flash numbers are released at 0658GMT, with German data at 0728GMT and EMU flash numbers at 0758GMT. There is a raft of UK data expected at 0830GMT, starting with August Retail Sales and including August CML Gross Mortgage Lending and the August SMMT Auto Production figures. At 1000GMT, the UK September CBI Monthly Industrial Trends data is released. The US calendar starts at 1145GMT, when Boston Federal Reserve Bank Pres. The first US data release is at 1230GMT, when Jobless Claims data for the Sept 15 week are released. At the same time, the August Leading Indicator is released and is forecast to fall 0.1%. At 1430GMT, the EIA Natural Gas Storage numbers for the Sept 14 week are released. The last scheduled US data is expected at 2030GMT, when the Money Supply (M2) numbers to Sept 10 are due.

07:58

Eurozone: Services PMI, September 46.0 (forecast 47.4)

07:58

Eurozone: Manufacturing PMI, September 46.0 (forecast 45.4)

07:41

Forex: Wednesday’s review

Yesterday the yen erased losses after reaching a four-week low versus the dollar as investors speculated the Bank of Japan unexpected monetary stimulus expansion will do little to augment economic growth.

The yen strengthened against almost all of its 16 most- traded counterparts even after policy makers added 10 trillion yen ($127 billion) in stimulus, following measures by the Federal Reserve and European Central Bank this month.

Earlier, the yen fell to four-week low against the dollar after the Bank of Japan unexpectedly announced the expansion of the program of monetary stimulus to support growth and reduce the value of the currency. The yen weakened against most of its 16 major counterparts after the central bank said it will increase the amount of asset purchase program, which is the main tool of monetary easing in the conditions close to zero interest rates, up to 80 trillion yen from 70 trillion yen and to extend its action for six months, until the end of 2013.

The euro rose against the dollar amid rising stock markets after existing home sales in the U.S. rose the most in a year. Thus, sales in the secondary market amounted to 4.82 million in August, is expected to 4.55 million Also today, the ECB held an auction to provide dollar liquidity to the tune of 3.72 billion dollars at 0.64% for 7 days. Data on the volume of construction in the euro zone at an annual rate in July showed a decline of -4.7%.