Forex Investment and Currency Trading

Eurozone The advance PMI for April showed a slight gain for the composite index, which edged up to 51.9 from 51.8 in March. This resulted from opposing trends in services and manufacturing, as services rose to 51.8 from 51.6 in the previous month, while manufacturing fell to 50.8 from 52.0 in March. Germany’s readings remained stronger than the Euro area’s, but showed a similar tendency between the two macro sectors, with services rising to 54.6 from 51.8 and manufacturing falling to 53.6 from 55.1. Given that manufacturing is more exposed to international competition, one can read the drop in the [...]

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There is usually a fair amount of discussion in advance of G7 finance minister meetings about major outcomes that could be announced at such gatherings. While there have been notable exceptions – particularly the Dubai G7 gathering in September 2003 – for the most part the volume of speculation usually exceeds the concrete outcomes by a meaningful multiple. It appears that will be the case later this week.
A number of issues have interested market participants in recent weeks. The fall in the USD back toward record lows in late March rekindled talk of potential intervention. However,the US position is likely [...]

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EUR
The EUR has been generally strong in recent months, extending gainsas the market lowers its expectations of ECB easing while simultaneously maintaining or raising expectations of Fed easing. This reflects generally resilient activity data from the Euro-zone, combined with rising inflation and higher wage growth. The ECB is maintaining its traditional hawkish stance and cannot be expected to ease while inflation remains high, wage awards appear to be delivering some sort of “second round effects” from the rise in food and energy prices, and while growth is only slowing modestly. Sub-trend growth will be seen as perfectly acceptable given the [...]

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Nothing too exciting with mostly month, quarter, fiscal year end activity dominating market movement. Euro-zone inflation jumped to record highs, IP in Japan continued to fall taking the Nikkei with it down 2.3% on close of Japanese fiscal year.

JPY  - It was all about the fixing. Closed soft in New York on Friday, continuing into the Sydney open, dipping below 98.85 before Japanese fixing demand drove it 140 points to print 100.16. Exporters were at the ready once again above 100 and things are now just a tiny bit higher than where we left them on Friday. Topside offers are expected to remain in place although [...]

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