The Morning Briefing is prepared daily at the start of the European Trading session by RTFX’s trading desk. It presents a roundup of the major news headlines occurring within the global economy that may affect the forex market. This news bulletin also includes a view of our forex calendar for the day, highs and lows achieved in the previous sessions from the forex market, global indices and commodities and brief commentary about the economic headlines.
Morning Briefing for Wednesday, 06 Jun 2012 (Updated 09:29:52 CET)ECB news conference in Focus
MORNING BRIEFING: ECB news conference in Focus
Asia: Asian & US Equities manage gains
Forex: Support favours the “riskier” currencies but the euro softer
Australia: Better than expected GDP
ECB: Should we expect another shot of liquidity?
Rates in Asia and Indices:
EURUSD: 1.2441 - 1.2516.
USDCHF: 0.9653 – 0.9596.
GBPUSD: 1.5373 - 1.5451.
EURJPY: 97.92 – 98.78.
USDJPY: 79.02 – 78.61.
DowJones: 12’127.95 +0.22%
NASDAQ: 2’778.11 +0.66%
S & P 500: 1’285.50 +0.57%
Nikkei: 8’533.53 +1.81%
Shanghai: 2'309.55 -0.1%
Gold: $ 1'628.90
Brent Oil : $ 84.91
A better than expected ISM for the services sector raised some hopes during yesterday’s US session; US equities closed in positive territory – we saw the Dow index come out of a four consecutive losing days. Despite the positive figures the marginal figures however lacked decisiveness. Asian equities also made gains this morning.
Despite the easing risk aversion on equity markets EUR/USD closed lower in yesterday’s session. This morning the currency pair has, at the time of writing, pared most of yesterday’s losses and has traded in the region of 1.2441-1.2516 so far today. The euro is softer despite the gains against the USD and JPY this morning.
Overall amongst the majors support has favoured the commodity bloc currencies, namely CAD, AUD and NZD.
Q1 GDP from Australia surprised positively yesterday a day after the RBA slashed its policy rates by 25bp. Q-O-Q GDP was out at 1.3% compared to an expected and previous 0.6%, the yearly equivalent was out at 4.3% compared to an expected 3.3% and a previous 2.5%.
Yesterday the emergency teleconference for G7 ministers promised to work together to deal both with Greece and Spain but no action came out of it so far. Today focus should shift to the ECB’s interest rate decision and the customary news conference 45 mins after the rate decision. The ECB is not expected to make any changes to its policy rates but markets are speculating that “super Mario” will be coming up with a new LTRO.
From the EZ we are expecting the revised figures for Q1 GDP we will see if the actual figures will confirm the flash estimates issued mid-May and which showed that growth for the first quarter was flat at zero.
The BoC was also due for its policy rate decision yesterday; the Canadian CB held rates unchanged at 1% as expected. In its statement following the monetary policy decision, the central bank once again signaled that they may raise its key rate later, but softened its hawkish stance.
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