Home > XE Currency Blog > XE Currency Blog - Market Analysis & Forex News
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
In the rear view mirror, 3rd quarter median employment costs rose, and indicated that real median wages have grown about half a percent YoY. Monthly reports in the last week for October were showed outright deflation in both consumer and producer prices, strong retail sales, a decelerating but positive Philadelphia Fed, and a 4 month low in existing home sales. The high frequency weekly indicators are an almost simultaneous "nowcast" of the economy, and although they can be noisy, taken together they will show a continuation or turning of a trend before it shows up in the monthly data. Read more
The dollar stayed lower versus European majors, and maintained a positive bias versus the yen in relatively light pre-weekend trade, with nothing on the U.S. data front to drive prices. Equities and Treasuries stayed fairly steady, and didn't give much impetus to dollar direction. Read more
Japan has been in a deflationary rut for the last 15-20 years. This presents an incredibly difficult policy dilemma for the central bank and other economic policy makers as deflationary expectations (the belief that prices will be lower tomorrow) are now firmly ingrained in the Japanese economic psyche. Read more
