FOMC: Voted 11-1 for Fed funds rate action
Dollar consolidates as investors expect interest rate decisions from the Federal Reserve and European Central Bank on the background of evidence that the economy around the world slows down. The data on the U.S. labor market proved to be very optimistic - according to the report, ADP, employment increased by 163 thousand in July, against the average forecast of 120 thousand other macro data also remained "in the shadows." For example, construction costs have shown an increase in line with expectations at 0.4% in June, and in the industry, according to a report ISM, was marked by the decline in July, the second consecutive month.
The euro rose against the yen after the Bundesbank President Jens Weidmann said the ECB should not cross the boundaries of the mandate. Recall that European politicians will announce its decision on interest rates tomorrow. Earlier, President Mario Draghi has promised to do everything possible to protect the single currency.
The pound fell after the published data on the UK showed that the index of manufacturing activity fell in July to their lowest values in the last three years. The index in July was at 45.4, up from 48.6 in June.
The yen fell against the dollar after Japanese Finance Minister Jun Azumi rejected the idea of buying the Bank of Japan bonds of foreign countries to weaken the yen. At the same time Azumi does not exclude the possibility of taking measures to curb the growth of the yen, including of currency intervention.
European stocks rose for the fourth time in five days as speculation central banks will take further steps to support the economic recovery outweighed the biggest contraction in U.K. manufacturing for three years.
A gauge of U.K. factory output, based on a survey by Markit Economics and the Chartered Institute of Purchasing and Supply, fell to 45.4 last month from a revised 48.4 in June, Markit said today. That’s the lowest in 38 months. A reading below 50 indicates contraction.
The Purchasing Managers’ Index in China unexpectedly fell to 50.1 in July, the weakest in eight months, from 50.2 in June, a government report showed today. Fifty marks the dividing line between expansion and contraction.
The Federal Reserve will conclude a two-day policy meeting after the close of European trading today. The U.S. central bank has carried out two rounds of so-called quantitative easing since Lehman Brothers Holdings Inc. collapsed in 2008, buying $2.3 trillion in bonds to boost the economy.
Bearish options on European stocks have fallen to the cheapest levels compared with bullish ones in 19 months as traders bet that Draghi will deliver on his promise to save the euro. The ECB will hold its next policy meeting tomorrow.
Benchmark indexes rose in seven of the 17 western European markets open today. The U.K.’s FTSE 100 (UKX) gained 1.4 percent while Germany’s DAX slipped 0.3 percent. Markets in Switzerland were closed for a holiday.
Standard Chartered Plc added 3.6 percent to 1,517.5 pence, the largest advance since June 6, after the U.K. bank that gets most of its revenue from Asia posted an 11 percent increase in first-half profit.
Bayerische Motoren Werke AG slid 2.9 percent to 58.99 euros. The world’s biggest maker of luxury cars reported a 19 percent drop in second-quarter profit amid increased spending on new models and “intense” pricing competition.
Oil climbed after U.S. crude inventories dropped the most in seven months and on speculation central banks will take steps to support the economic recovery
Futures rose as much as 1.3 percent after the U.S. Energy Department said stockpiles decreased 6.52 million barrels last week, the biggest decline since the seven days ended Dec. 16. Supplies were forecast to fall 1 million barrels. A Federal Reserve policy meeting ends today and the European Central Bank’s Governing Council gathers tomorrow.
Crude oil for September delivery rose to $89.20 a barrel on the New York Mercantile Exchange. Futures traded at $88.63 a barrel before release of the inventory report. Prices gained 3.6 percent last month and are down 11 percent this year.
Brent oil for September settlement increased 79 cents, or 0.8 percent, to $105.71 a barrel on the London-based ICE Futures Europe exchange.

U.S. stocks are mixed as investors awaited the outcome of the Federal Reserve’s meeting for clues on more stimulus measures to support the world’s largest economy.
Currently:
Dow 13,052.04 +43.36 +0.33%
Nasdaq 2,935.69 -3.83 -0.13%
S&P 500 1,382.85 +3.53 +0.26%
Gold prices down pending the outcome of the meetings of the European Central Bank and U.S. Federal Reserve.
The Fed on Wednesday will report results of a two-day meeting. Analysts believe that the central bank will make it clear that he is ready to protect the flagging economy, but will refrain from aggressive action.
On Thursday the European Central Bank will announce the outcome of the meeting from which the markets are waiting for decisive action to save the eurozone.
Stocks of the world's largest gold ETF-secured fund SPDR Gold Trust, on Tuesday rose 3.32 tons, a decrease in July, more than 27 tons.
The cost of the August gold futures on the COMEX today fell to 1594.9 dollars per ounce.

EUR/USD $1.2300, $1.2350, $1.2400, $1.2000
USD/JPY Y78.40, Y78.50, Y79.00
GBP/USD $1.5660, $1.5680, $1.5850
EUR/GBP stg0.7800
GBP/JPY Y122.50
EUR/SEK Sek8.40
U.S. stock futures rose as investors awaited the outcome of the Federal Reserve’s meeting for clues on more stimulus measures to support the economy.
Global Stocks:
Nikkei 8,641.85 -53.21 -0.61%
Hang Seng 19,820.38 +23.57 +0.12%
Shanghai Composite 2,123.36 +19.73 +0.94%
FTSE 5,698.48 +63.20 +1.12%
CAC 3,324.72 +33.06 +1.00%
DAX 6,776.54 +4.28 +0.06%
Crude oil $88.44 +0,43%
Gold $1611.00 -0.22%
Wal-Mart (WMT) was upgraded to a Hold from Sell at Deutsche Bank
Data
01:00 China Manufacturing PMI July 50.2 50.4 50.1
01:30 Australia House Price Index (QoQ) Quarter II -1.1% -0.5% +0.5%
01:30 Australia House Price Index (YoY) Quarter II -4.5% -4.2% -2.1%
06:00 Switzerland Bank holiday -
06:00 United Kingdom Nationwide house price index July -0.6% -0.1% -0.7%
06:00 United Kingdom Nationwide house price index, y/y July -1.5% -2.0% -2.6%
06:30 Australia RBA Commodity prices, y/y July -10.5% -9.8%
07:50 France Manufacturing PMI (finally) July 45.2 43.6 43.4
07:55 Germany Manufacturing PMI (finally) July 45.0 43.3 43.0
08:00 Eurozone Manufacturing PMI (finally) July 45.1 44.1 44.0
08:30 United Kingdom Purchasing Manager Index Manufacturing July 48.6 48.7 45.4
The dollar showed mixed performance against the euro, as investors expect interest rate decisions from the Federal Reserve and European Central Bank on the background of evidence that the economy around the world slows down.
The euro rose against the yen after the Bundesbank President Jens Weidmann said the ECB should not cross the boundaries of the mandate.
Recall that European politicians will announce its decision on interest rates tomorrow. Earlier, President Mario Draghi has promised to do everything possible to protect the single currency.
The pound fell after the published data on the UK showed that the index of manufacturing activity fell in July to their lowest values in the last three years. The index in July was at 45.4, up from 48.6 in June.
The Australian dollar traded near a four-month high against its U.S. counterpart, as the demand for risky assets rose on speculation.
Also note that the Fed can now announce additional stimulus measures after the completion of a two-day meeting.
The New Zealand dollar rose today amid speculation that the Fed will implement the next round of quantitative easing. But demand for the currency of the South Pacific, declined after the information that China has recorded decline in the manufacturing industry, which is Australia's largest trading partner and second largest exporter to New Zealand.
EUR/USD: a pair of mid-session trading in a narrow range, but updated with the maximum of the previous day
GBP/USD: a pair of substantially reduced by updating with a minimum of 31 July and is now trading in the minimum values
USD/JPY: a pair of sharply decreased, while setting a minimum level of Y77.90, and then increased by updating the maximum value of the day
At 12:15 GMT the U.S. becomes aware of change in the number employed by ADP in July. At 13:00 GMT the U.S. will publish data on the index of business activity in the manufacturing sector in July, and will be released at 14:00 GMT ISM manufacturing index for July. At 14:30 GMT the U.S., there are data on stocks of crude oil from the Ministry of Energy in July.
At 18:15 GMT the U.S. FOMC decision expected to be published on the basic interest rate, after which followed a statement accompanying FOMC.
EUR/USD
Offers $1.2440/50, $1.2420, $1.2390/400, $1.2375/80
Bids $1.2250/40, $1.2225/20, $1.2180/70
GBP/USD
Offers $1.5780, $1.5750
Bids $1.5580, $1.5560/50, $1.5535/30
AUD/USD
Offers $1.0635/40, $1.0560
Bids $1.0480, $1.0450, $1.0430/25, $1.0400
EUR/JPY
Offers Y97.30/35, Y97.00, Y96.80/85, Y96.70, Y96.50
Bids Y95.80, Y95.75/70, Y95.65/60, Y95.50, Y95.20, Y95.00
USD/JPY
Offers Y78.80, Y78.65/70, Y78.50, Y78.40, Y78.30
Bids Y78.00, Y77.00
EUR/GBP
Offers stg0.7920/30, stg0.7895/900, stg0.7880
Bids stg0.7830, stg0.7810/00, stg0.7780/75, stg0.7755/50
The indices are growing against the backdrop of corporate news and an optimistic mood about the meeting of the European Central Bank, which will be held August 2 this year. It is expected that during the meeting of the ECB may purchase gosbondov restart the program to reduce the cost of credit for Spain and Italy.
At the moment:
FTSE 100 5,665.20 +29.92 +0.53%
DAX 6,775.41 +3.15 +0.05%
CAC 3,301.20 +9.54 +0.29%
The increase demonstrates the banking sector. Shares of Royal Bank of Scotland rose by 1,2%, HSBC - by 1.1%. Paper rose in price Lloyds Banking Group - by 0.3% and Barclays - by 0.2%.
Shares of ENI SpA rose 0.9% after the publication of the financial report for the I half of 2012. Net income for the period grew by 1.1% - up to 3.844 billion euros compared with a profit of 3.801 billion euros in the same period a year earlier. Net operating revenues ENI in January-June this year increased by 20.3% and amounted to 63.203 billion euros (previous year - 52.526 billion euros).
EUR/USD $1.2300, $1.2350, $1.2400, $1.2000
USD/JPY Y78.40, Y78.50, Y79.00
GBP/USD $1.5660, $1.5680, $1.5850
EUR/GBP stg0.7800
GBP/JPY Y122.50
EUR/SEK Sek8.40
China’s manufacturing expanded at the slowest pace in eight months and South Korea’s exports fell. Japanese shares led declines on disappointing earnings reports.
Nikkei 225 8,641.85 -53.21 -0.61%
S&P/ASX 200 4,262.8 -6.35 -0.15%
Shanghai Composite 2,121.89 +18.25 +0.87%
Fanuc Corp. a maker of robotic controls for Chinese factories, fell 2.5 percent in Tokyo.
Samsung Electronics Co., South Korea’s biggest exporter of consumer electronics, slid 0.7 percent. Sumitomo Heavy Industries Ltd. and Komatsu Ltd. led industrial shares lower after cutting earnings forecasts.
Intrepid Mines Ltd., an Australian company exploring for gold in Indonesia, surged 32 percent after saying a new shareholder would help safeguard its project in the Southeast Asian country.
01:00 China Manufacturing PMI July 50.2 50.4 50.1
01:30 Australia House Price Index (QoQ) Quarter II -1.1% -0.5% +0.5%
01:30 Australia House Price Index (YoY) Quarter II -4.5% -4.2% -2.1%
The euro erased losses as Asian shares pared declines and amid prospects central banks will take further steps to support growth.
The 17-nation currency rose against the yen after Italian Prime Minister Mario Monti was quoted as saying the country may want its sovereign bonds to be purchased by the region’s rescue funds and the European Central Bank. Monti and French President Francois Hollande said yesterday the two countries are “determined” to do everything to protect the integrity of euro zone.
ECB President Mario Draghi pledged last week to do whatever it takes to preserve the currency. He has a proposal that involves the EFSF buying government debt on the primary market, buttressed by ECB purchases on the secondary market to ensure lenders transmit its record-low interest rates, two central bank officials said on July 27 on condition of anonymity. Further ECB interest-rate cuts and long-term loans to banks are also up for discussion, one of the officials said.
Demand for the greenback was limited before a private payrolls report today forecast to show the pace of hiring in the U.S. slowed, supporting bets the Fed will signal additional stimulus which would debase the currency.
Companies probably added 120,000 jobs last month, down from 176,000 in June, according to the median estimate of economists surveyed by Bloomberg before ADP Employer Services releases its data today. The Labor Department is scheduled to release its monthly jobs report on Aug. 3, with the unemployment rate predicted to remain unchanged at 8.2 percent, according to a separate poll.
EUR / USD: during the Asian session the pair was trading in range $1.2280-$1.2300.
GBP / USD: during the Asian session the pair was trading in range $1.5655-$1.5675.
USD / JPY: during the Asian session the pair dropped, updating week’s low.
Wednesday morning also sees the release of the manufacturing PMIs, including Spain at 0713GMT, Italy at 0743GMT and the final manufacturing PMIs from France at 0748GMT, Germany at 0753GMT and the EMU data at 0758GMT.The weekly MBA. Preliminary results from the others were 43.6 in France, 43.3 from Germany and 44.1 for the EMU data. Germany releases chine orders data at 0800GMT. The UK Nationwide House Prices index gets things started at 0600GMT Wednesday. UK manufacturing PMI is due at 0828GMT and is expected to decline to 48.0. Mortgage Application Index is due at 1100GMT, followed at 1215GMT by the ADP National Employment and then at 1258GMT by the US Markit PMI data. Data at 1400GMT includes the ISM Index,Help-wanted and also Construction Spending data. The weekly EIA Crude Oil Stocks data then follows at 1430GMT. At 1815GMT, the Federal Open Market Committee issues the statement on its latest monetary policy decisions, following two days of meetings.
The euro rose against most of its major counterparts on speculation the European Central Bank will take steps at a meeting this week to stem the rise of the region’s sovereign-bond yields.
French President Francois Hollande buoyed the shared currency earlier, saying all will be done to defend and preserve it. He and Italian President Mario Monti issued a joint statement after meeting in Paris today.
Draghi has a proposal that involves the European Financial Stability Facility buying government debt on the primary market, buttressed by ECB purchases on the secondary market to ensure lenders transmit its record-low interest rates, two central bank officials said on July 27 on condition of anonymity. Further ECB interest-rate cuts and long-term loans to banks are also up for discussion, one of the officials said
The shared currency pared gains after the German Finance Ministry said in an emailed statement it sees no need to give Europe’s rescue fund a banking license.
The pound tumbled for the first time in four days against the euro after Moody’s Investors Service lowered its forecast for U.K. economic growth.
Asian stocks rose, with the regional benchmark index headed for a second monthly gain, on speculation the Federal Reserve and the European Central Bank may signal their readiness to stimulate growth amid signs of a global economic slowdown, boosting the earnings outlook for exporters.
Nikkei 225 8,695.06 +59.62 +0.69%
S&P/ASX 200 4,269.2 +23.49 +0.55%
Shanghai Composite 2,103.67 -6.24 -0.30%
Canon Inc., the world’s biggest camera maker, advanced 5.8 percent in Tokyo on a share buyback plan, pacing gains among information technology shares.
Hokuriku Electric Power Co. soared 14 percent, leading Japanese utilities higher after raising its sales forecast.
Campbell Brothers Ltd., a provider of laboratory services for the mining industry, slumped 10 percent in Sydney after saying volatility and uncertainty in the global economy may have a negative earnings impact.
European stocks fell, even as the Stoxx Europe 600 Index completed its second straight monthly rally, after companies including BP Plc and UBS AG posted earnings that missed forecasts and investors awaited the outcome of a two-day Federal Reserve meeting.
The German Finance Ministry said it sees no need to award a banking license to the euro-area’s permanent rescue fund, the European Stability Mechanism.
National benchmark indexes retreated in 16 of the 18 western-European markets today. The U.K.’s FTSE 100 Index slid 0.8 percent, while Germany’s DAX Index added 0.2 percent. France’s CAC 40 Index fell 0.6 percent.
BP lost 4.4 percent to 425.05 pence, the most since Sept. 22. Europe’s second-biggest oil company reported a loss in the second quarter as the company wrote down the value of U.S. assets and production dropped. BP reported a net loss of $1.4 billion compared with a profit of $5.7 billion a year earlier, the London-based company said today in a statement. Excluding one-time items and changes in inventories, profit missed analyst estimates.
UBS retreated 5.9 percent to 10.29 Swiss francs, the biggest decline since October. Switzerland’s biggest bank reported second-quarter profit that fell 58 percent, missing analysts’ projections, as its investment bank lost money on the Facebook Inc. share sale. Net income declined to 425 million francs ($434 million) from 1.02 billion francs a year earlier.
Change % Change Last
Gold 1,618 -6 -0.39%
Oil 87.96 -1.82 -2.03%
Change % Change Last
Nikkei 225 8,695.06 +59.62 +0.69%
S&P/ASX 200 4,269.2 +23.49 +0.55%
Shanghai Composite 2,103.67 -6.24 -0.30%
FTSE 100 5,635.28 -58.35 -1.02%CAC 40 3,291.66 -29.05 -0.87%
DAX 6,772.26 -1.80 -0.03%
Dow 13,009 -64 -0.49%
Nasdaq 2,940 -6 -0.21%
S&P 500 1,379 -6 -0.43%
(pare/closed(00:00 GMT +02:00)/change, %)
EUR/USD $1,2298 +0,36%
GBP/USD $1,5672 -0,19%
USD/CHF Chf0,9767 -0,33%
USD/JPY Y78,11 -0,06%
EUR/JPY Y96,07 +0,30%
GBP/JPY Y122,40 -0,26%
AUD/USD $1,0491 +0,10%
NZD/USD $0,8085 +0,10%
USD/CAD C$1,0034 +0,14%
01:00 China Manufacturing PMI July 50.2 50.4 50.1
01:30 Australia House Price Index (QoQ) Quarter II -1.1% -0.5% +0.5%
01:30 Australia House Price Index (YoY) Quarter II -4.5% -4.2% -2.1%
06:00 Switzerland Bank holiday -
06:00 United Kingdom Nationwide house price index July -0.6% -0.1%
06:00 United Kingdom Nationwide house price index, y/y July -1.5% -2.0%
06:30 Australia RBA Commodity prices, y/y July -10.5%
07:00 United Kingdom Halifax house price index July +1.0%
07:00 United Kingdom Halifax house price index 3m Y/Y July -0.5%
07:50 France Manufacturing PMI (finally) July 45.2 43.6
07:55 Germany Manufacturing PMI (finally) July 45.0 43.3
08:00 Eurozone Manufacturing PMI (finally) July 45.1 44.1
08:30 United Kingdom Purchasing Manager Index Manufacturing July 48.6 48.7
12:15 U.S. ADP Employment Report July 176 122
13:00 U.S. Manufacturing PMI (finally) July 51.8 51.9
14:00 U.S. ISM Manufacturing July 49.7 50.4
14:30 U.S. Crude Oil Inventories - +2.7
18:15 U.S. Fed Interest Rate Decision - 0.25% 0.25%
18:15 U.S. FOMC Statement -
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