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Yesterday's report that October housing permits cam in at 1.034 million on an annualized basis, the highest in over 5 years, as shown in the graph below: Read more
FX markets were thin ahead of tomorrow's U.S. Thanksgiving holiday and month-end. The dollar was weighed by positive leads from Europe, though USD-JPY was the exception due to cross-flows. EUR-USD broke 1.3600 after German Chancellor Merkel reached a coalition deal, along with a rise in German consumer confidence data. Read more
FX markets in Asia were thin ahead of tomorrow's U.S. Thanksgiving holiday and month-end. Intra-day accounts keyed off short-term technical indicators, which enabled EUR-USD to post a modest rally on 1.3600, while USD-JPY was underpinned by corporate demand and a rally via the JPY crosses. Read more
The dollar meandered in fairly light pre-holiday trade on Tuesday, though ended mostly lower versus major currencies. EUR-USD made its way to highs over 1.3570 after finding support into 1.3520, as USD-JPY again failed to test 102.00, and fell toward 101.20 on paring of long positions. Read more
The European morning was quiet with the exception of position adjustment as the market slows down into the U.S. Thanksgiving holiday. Usually there is a pick up in dollar demand as funds close books ahead of the year-end. However, the USD has stormed higher in recent weeks against JPY and held firm against the commodity bloc, which could potentially dampen scope for further dollar upside this week. Read more
Position adjustment may begin to have an influence as the market slows down into the U.S. Thanksgiving holiday. Usually there is a pick up in dollar demand as funds close books ahead of the year-end. However, the USD has stormed higher in recent weeks against JPY and held firm against the commodity bloc, which could potentially dampen scope for further dollar upside this week. Read more
The dollar firmed up modestly in N.Y. dealings on Monday, though remained inside a narrow range versus most major currencies. EUR-USD found support under 1.3500, while the 102.00 mark for USD-JPY remained elusive. The economic calendar was light, with a softer pending home sales report offset by a strong Markit composite PMI outcome. Read more
The European Central Bank is facing a very difficult policy environment: inflation that is too low and unemployment that is too high. Consider the following two charts: Inflation has been decreasing for the last two years, dropping from an annual rate of 3% at the end of 2011 to .7% in the latest reading. At the same time, unemployment has been rising, although it appears to have peaked at a little over 12% over the last nine months. The central bank has come close to exhausting traditional policy options. Read more
A small correction was noted during the European morning session. The dollar made up ground against EUR and GBP after underperforming in early Asia, while USD-JPY and the JPY crosses also pulled back from overbought levels. The positive close for U.S. Read more
Last week, Markit released its monthly manufacturing reports for the EU region. The composite reading was 51.5 which was the fifth month showing expansion. However, the primary driver of the change was Germany, while other EU countries had readings slightly above 50 or just below. Read more
