Home > XE Currency Blog > XE Currency Blog - Market Analysis & Forex News
Above is a chart for the EUR/USD. For the last half of 2013 the euro rallied as EU news tended to be more bullish relative to US news. But since that time, we've seen a turn of events towards the US. First, the last two quarters of US economic growth have been over 3%. Read more
20140131074854.png)
The EUR came under some pressure after the weaker than expected inflation number added to speculation of a rate cut by the ECB next week. Eurozone Jan HICP inflation unexpectedly fell to 0.7% y/y from 0.8% y/y in December. The Euro is also slightly weaker against the CHF and heading for its biggest monthly decline since March and the first loss since August against the USD, amid speculation of further easing measures. Read more
In the past I've noted that <a href="http://bonddad.blogspot.com/2012/03/consumer-spending-pattern-does-not.html">comparing the performance of</a> personal consumption expenditures and real retail sales is a good way to see where we are in the economic cycle. Below is a graph comparing the two by subtracting YoY PCE growth from YoY real retail sales growth, through 1997. Read more
The EUR came under some pressure after the weaker than expected inflation number added to speculation of a rate cut by the ECB next week. Eurozone Jan HICP inflation unexpectedly fell to 0.7% y/y from 0.8% y/y in December. The Euro is also slightly weaker against the CHF and heading for its biggest monthly decline since March and the first loss since August against the USD, amid speculation of further easing measures. Read more
The Fed did not surprise, as it tapered another $10 bln from its asset purchase program. The dollar had been on the rise early in N.Y. trade on Wednesday, though as equities melted down, along with Treasury yields, the greenback moved mostly lower. The Fed made no mention of emerging markets in its statement, though with some linking current EM woes to the Fed's slow retreat, emerging currencies will be watched closely.[EUR, USD]More consolidation may be in store for EUR-USD, as the 1.3600-1.3700 band continued to hold up. Read more
The USD weakened against most currencies after the Fed cut monthly bond purchases by another $ 10 bln as expected. The move counterbalanced attempts in South Africa and Turkey to boost their currencies though rate hikes and rekindled save haven demand. Read more
Starting at the end of last week, emerging market currencies sold off sharply, along with developed market equities. The primary cause of this sell-off was concern that China was in fact slowing down. Since most emerging markets sell raw materials to China, China’s slowdown would have a negative impact on their respective GDPs. Read more
The dollar was broadly higher in N.Y. trade on Thursday. Despite a small miss on GDP, and firmer claims data, risk appetite returned, taking Wall Street sharply higher following its rout earlier in the week. This supported the greenback versus most major currencies. Read more
FX trade was choppy through the morning, as rate hikes in Turkey and South Africa kept EM fears alive and stoked. The greenback started out on stronger ground, though quickly fell back with equities, and save haven related Treasury buying. The dollar edged higher after the FOMC announcement and taper, which was widely expected, though reaction was fairly muted. Read more
The USD is little changed, with EUR-USD trading around 1.3660, after rising to 1.3685 earlier. Yen and Swiss franc meanwhile erased declines as the impact of the Turkish rate hike fades. It seemed the Turkish move revived confidence in emerging markets and reduced safe haven demand, but this was only short lived with the focus turning to the FOMC announcement today. Read more
20140131074854.png){kind=link}