Forex: Tuesday's review
02.03.2011, 09:17

Forex: Tuesday's review

The dollar fell against most of its major counterparts as Federal Reserve Chairman Ben S. Bernanke said rising oil and commodity prices probably won’t boost broader inflation and interest rates will likely remain low.
Experience with price gains in recent decades, along with currently stable labor costs, suggests a “temporary and relatively modest increase in U.S. consumer price inflation,” Bernanke told the Senate Banking Committee in his semiannual monetary policy testimony.
Bernanke reiterated the Fed’s outlook that while growth will accelerate this year, he still wants to see a “sustained period of stronger job creation.”
The euro gained versus the dollar as the European Commission raised its growth forecast and said inflation may stay above the European Central Bank’s limit for most of 2011.
The dollar briefly erased losses against the euro after the Institute for Supply Management’s factory index increased to 61.4. from 60.8 in February, the Tempe, Arizona-based group said today. Readings greater than 50 signal growth. 
The ISM’s measure of new orders in the U.S. rose in February to 68, the highest since January 2004, from 67.8. The employment gauge jumped to 64.5, the highest since January 1973, from 61.7 in the prior month.

EUR/USD: the pair bargained within the limits of $1,3740-$ 1,3770.
GBP/USD: the pair bargained within the limits of $1,6215-$ 1,6275.
USD/JPY: the pair shown high in the field of Y82,20 then decreased.
US data starts at 1200GMT with the weekly MBA Mortgage Application Index and is followed by Challenger Layoffs data at 1230GMT.Fed speakers start at 1300GMT when Kansas City Fed President Thomas Hoenig delivers a speech to the Council on Foreign Relations in New York. The ADP National Employment Report then follows, at 1315GMT. At 1500GMT, Federal Reserve Chairman Ben Bernanke is back, giving his semi-annual monetary policy report to the House Financial Services Committee in Washington.
The main core-European release is industrial PPI for January, which is expected to rise by a reading of 1.1% m/m, 5.8% y/y. 
UK: The UK starts the main data calendar with the release of PMI Construction data at 0930GMT.
Data then continues with the 1500GMT release of the latest  Help-wanted Online index and also the 1530GMT release of EIA Crude Oil Stocks data. Later on, the Fed releases it's latest Beige Book, at 1900GMT. 

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