European and North American names lifted EURUSD to intraday highs before late-day profit-taking ensued. The pair got a lift after it was reported that ADP April private sector jobs were down a less-than-expected 491,000, much lower than forecast and lower than the downwardly revised 708,000 figure for March.
U.S. April non-farm payrolls report will be released on Friday and forecasts are calling for around a 580,000 to 610,000 decline in jobs in addition to the 663,000 loss already announced for March. Federal Reserve Chairman Bernanke reported he expects the unemployment rate to top out at a 9% handle even after the U.S. economic recovery has started.
The big item on traders’ radar today is the release of U.S. banks’ stress tests results. There is widespreads talk that around ten of the nineteen largest banks – including Citigroup, Bank of America, and Wells Fargo – will be asked to raise additional capital to support their financial positions. There is talk that Bank of America may need to raise as much as US$ 34 billion in additional capital.
The European Central Bank is expected to announce that it is reducing its main refinancing rate by 25bps to 1.00% today. Some dealers believe the ECB may announce quantitative easing measures. Other data released today saw EMU-16 April services PMI improve to 43.8 from 40.9 in March.
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LONDON, April 24 (Reuters) - Britain's economy shrank more than expected and at its sharpest rate in 30 years in the first three months of 2009, official data showed on Friday, suggesting the recession may be deeper than feared.
The Office for National Statistics said gross domestic product fell 1.9 percent on the quarter in the first three months of this year, the biggest fall since Q3 1979 and below forecasts for a 1.5 percent contraction.
Most analysts had expected the 1.6 percent fall seen at the end of last year to mark the worst period of the recession.
On the year, GDP fell by 4.1 percent, the biggest annual drop since the end of 1980. Analysts had expected a 3.8 percent contraction.
The figures suggest there are downside risks to finance minister Alistair Darling's forecast for a 3.5 percent contraction this year -- he had expected Q1 GDP figures to show a similar drop to Q4.
Friday's data also suggest policymakers may need to do more to kick-start the economy, having already slashed interest rates to a record low of 0.5 percent and started buying assets with newly created money.
The government has also pumped more than 20 billion pounds into the economy.
The ONS data showed the biggest quarterly fall in manufacturing output since records began in 1948 and the biggest quarterly fall in services output since 1979.
Business services and finance recorded its biggest drop in output since records began in 1983.
FX employment holds firm in Asia
Foreign exchange (FX) professionals are still in demand in Asia. The sector is comparatively profitable and liquid, layoffs are limited, and small-scale hiring is still happening. But currency jobs are unlikely to save bankers in less buoyant industries – firms only want candidates who already have an FX background.
“I haven’t seen many redundancies at all in this area. It seems to be a safe haven compared to DCM and ECM,” says Pernille Storm, director of banking and financial services at recruiters Hudson.
There is still recruitment going on in operations and in the middle office to support front-office growth and to control risk. “While in the back office the need for specific product knowledge is not essential, it is needed for middle office roles where trades are booked and queried. A strong product understanding is key to executing the job without error,” adds Storm.
Banks generally want people with experience in complex products - not just vanilla FX - because their clients are seeking structures that can enable them to hedge exposures, limit risk and at the same time benefit from FX volatility.
The job market is predictably employer-led. Storm comments: “Firms are in a much stronger position and have a broader spectrum of candidates from different markets to hire from. This is naturally making hiring managers more demanding and upping the ante in terms of requirements.”
Banks are generally not keen on candidates from non-FX backgrounds. In the front office, even equity and debt traders with structured product experience will find it difficult to move across to an FX role. “There is also a growing talent pool of foreign FX professionals looking to come to Asia and thus making it more difficult for local talent to move across product groups,” says Storm.
London and New York are more advanced in terms of products, so professionals from those markets are still sought after by banks in Asia.
Source: http://news.efinancialcareers.sg
16 January 2009 by Simon Mortlock
If you do not have a forex trading account and want to try out forex trading, you can open a forex trading account with only minimum capital of US$100, click here to open.
Once you master the art of forex trading, you do not have to worry about job insecurity in 2009, because you will be recession free.
Prices are doubling every day and food and fuel are in short supply. A cholera epidemic has killed more than 2,000 people and a deadlock between President Robert Mugabe and the opposition has put hopes of ending the crisis on hold.
Hyper-inflation has forced the central bank to continue to release new banknotes which quickly become almost worthless.
There is an official exchange rate, but most Zimbabweans resort to the informal market for currency transactions.
In addition to the Z$100 trillion dollar note, the Reserve Bank of Zimbabwe plans to launch Z$10 trillion, Z$20 trillion and Z$50 trillion notes, the Herald newspaper reported.
"In a move meant to ensure that the public has access to their money from banks, the Reserve Bank of Zimbabwe has introduced a new family of banknotes which will gradually come into circulation, starting with the Z$10 trillion," the Herald said, citing a statement from the central bank.
Previous issues of new banknotes have done little to curb the cash crunch faced by Zimbabweans, who often line up for hours outside banks to withdraw barely enough to buy a loaf of bread.
Critics blame the economic meltdown on mismanagement by Mugabe's government, including the seizure and redistribution of thousands of white-owned farms. The once-thriving agricultural sector has fallen into ruin.
The veteran Zimbabwean leader, in power since independence from Britain in 1980, says Western sanctions are the main cause of the economic crisis and worsening humanitarian picture.
Political analysts say the establishment of a unity government between Mugabe's ZANU-PF party and the opposition Movement for Democratic Change (MDC) is the best hope of reversing the economic slide and worsening humanitarian crisis.
But power-sharing talks are deadlocked over the control of important government ministries. Tsvangirai accuses Mugabe of trying to assign the MDC a junior role and has demanded the release of detained opposition members before a deal is implemented.
The presidents of regional powers South Africa and Mozambique will meet political parties in Zimbabwe on Monday in a new regional push to break the impasse, South Africa's government said on Thursday.
Source: Telegraph.co.uk
Last Updated: 7:23PM GMT 16 Jan 2009
George Soros has no worries about the global recession. He and a handful of others in the arcane and virtually unregulated world of hedge funds have made a bundle off the global recession.
“I'm having a very good crisis,” Soros says, quoted by the U.K. Daily Mail.
As the Obama administration sets its sets on reining in the industry, Soros and others literally made billions by taking contrarian bets against stocks.
As stocks fell in half, pension funds collapsed and millions of savers watched their 401(k)s founder, Soros made $1.1 billion last year.
“It is, in a way, the culminating point of my life’s work,” Soros told The Australian.
Institutional Investor’s Alpha magazine reports that the best-paid hedge fund managers were paid $11.6 billion last year, the third-best year on record, although down sharply from the $22.5 billion in paychecks they cashed in 2007.
Among the top earners (all are estimates):
• James Simons, Renaissance Technologies, $2.5 billion
• John Paulson, Paulson and Co., $2 billion
• John Arnold, Centaurus Energy, $1.5 billion
• George Soros, Soros Fund Management $1.1 billion
Even if you were pretty bad at running a hedge fund it was a good year, the magazine reported. Average take-home pay for the top echelon was $464 million and the average fund CEO packed away $2 million.
Forex is a good tool to hedge against falling stock market. Sign-up for my education package to tap on this opportunity
The Federal Open Market Committee (FOMC) said in its statement yesterday that the central bank will buy longer-term U.S. government debt and purchase an additional $750 billion of agency mortgage-backed securities, in a policy known as quantitative easing. In its statement at the conclusion of its 2 day policy meeting, the Fed indicated that it is more pessimistic about economic outlook.
In my opinion Dollar weakness may not last long given the worsening economic conditions throughout the world. Dollar will continue to be seen as the safest store of value at this time of contracting global growth and its role as a funding currency outside of Europe will lend it support during the crisis.
After an exceedingly volatile price-spike for AUDUSD, the price of this pair has remained floating in the over-bought territory on both Stochastic and Williams charts. At the same time resistance holding very well at 0.6847. All this signal that a downward correction may occur in the coming hours. Going short on AUDUSD might be the right strategy for today.
Risk Disclosure:
Forex trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to participate in the futures trading markets. Don't trade with money you can't afford to lose. This website is neither a solicitation to invest nor an offer to Buy/Sell futures or options. The past performance of any trading system or methodology is not necessarily indicative of future results.
Disclaimer:
Please note that email updates are for educational purposes only.
The service is offered as an opinion on the current state of the market but not recommendations. The information provided should not be relied on as a substitute for extensive independent research before making your trading/investment decisions. We are merely providing this service for your general information. No representation is being made that any view or opinion will guarantee profits or not result in losses from trading. In addition any projections or views of the market provided may not prove to be accurate.
The Dollar pared losses against the EUR on Monday after the New York Federal Reserve Bank's manufacturing index fell to a record low in March, adding to worries about the U.S. economy.
Moreover, economic data published yesterday imply that the U.S. recession is likely to deepen further. The Empire State Manufacturing Index had its worst showing since 2001! This are signals that economic difficulties are starting to spread from the financial sector into the mainstream economy. Investors will have to adapt themselves to the upcoming economic hardships as these changes will not rectify themselves within a short period of time.
AUDUSD appears that the bullish trend may have run out of strength as the current price level pushed the pair into the overbought territory on the daily chart's Stochastic and Williams, indicating that a downward reversal may occur later. Remain short on AUDUSD would be the right choice today.
All the posting are delayed, I can share live updates of my content via emails. If you are interested to receive live updates, send an email to me at atraderx@gmail.com.
Australia’s central bank policy makers said they have scope to cut interest rates further after pausing this month to assess the impact of record reductions in benchmark borrowing costs and increased government spending.
Board members saw “reasonable cases” for both pausing to evaluate the economy and cutting the official cash rate target from a 45-year low of 3.25 percent, the Reserve Bank of Australia said in minutes of its March 3 meeting, released in Sydney today.
Governor Glenn Stevens and his board left the benchmark lending rate unchanged for the first time in seven months amid signs the “monetary and fiscal stimulus that had been applied to the economy was having an expansionary effect,” the minutes said. Still, the size of this boost “remained unclear” and was likely to take time to become evident.
Leaving the cash rate unchanged “would leave adequate flexibility for policy at future meetings,” today’s minutes said.
The bank’s four percentage points of reductions in the benchmark rate between September and February, as well as the government’s decision in February to spend A$42 billion ($28 billion) on handouts and infrastructure, preceded official figures on the “extent of economic weakness,” the minutes said.
Australia’s dollar declined to 65.78 U.S. cents as of 11:33 a.m. in Sydney, from 65.91 cents before the minutes were released.
A report published one day after the bank’s March meeting showed the economy unexpectedly shrank 0.5 percent in the fourth quarter, the first contraction in eight years. Board members had expected a “small fall” in growth.
Risk Disclosure:
Forex trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to participate in the futures trading markets. Don't trade with money you can't afford to lose. This website is neither a solicitation to invest nor an offer to Buy/Sell futures or options. The past performance of any trading system or methodology is not necessarily indicative of future results.
Disclaimer:
Please note that email updates are for educational purposes only.
The service is offered as an opinion on the current state of the market but not recommendations. The information provided should not be relied on as a substitute for extensive independent research before making your trading/investment decisions. We are merely providing this service for your general information. No representation is being made that any view or opinion will guarantee profits or not result in losses from trading. In addition any projections or views of the market provided may not prove to be accurate.
The European Central Bank is prepared to bring its key policy rate lower possibly to zero if the economic situation deteriorates further, ECB Executive Board member Lorenzo Bini Smaghi said on Tuesday.
“If the (economic) situation worsens, the ECB is ready to reduce rates further, even to zero,” the central banker said in an interview with German newspaper Börsen-Zeitung.
“That is above all the case if the economy was really threatened by sustained deflation,” Bini Smaghi added. “And in such a situation, the bast approach would be to act sooner rather than later.” However, Bini Smaghi was quick to add that he did not foresee the risk of prolonged deflation in the euro zone.
“The data that we have, including market expectations derived from the yield curve, do not suggest sustained deflation in the euro zone,” he said.
Bini Smaghi also said that cutting rates to low levels and then increasing them would not help the economy.
Bini Smaghi added that buying government bonds in the secondary market would not be in line with the spirit of the ECB and doubted that a central bank could effectively lower longer term rates by purchasing government paper.
The Dollar rose against most of its major currency pairs on Monday. This comes about as falling global equity markets and economic deterioration in Japan and Europe, which are more serious than the slowdown in the U.S., have boosted safe-haven demand for the U.S currency. Nevertheless, the U.S. has also released gloomy economic data.
Last Friday's report showed that the U.S. unemployment rate rose to a high of 8.1% in February, as employers cut 651,000 jobs. This reveals that the U.S. has the highest unemployment rate since 1983. Analysts expected weak figures from the U.S. to lead market participants to take positions against the USD in Monday's trading. However, in many respects, much the opposite has happened.
USDCHF is exhibiting strong short term bullish signals. Going long on USDCHF would be the right strategy for today.
After years of building systems, testings, modifications, and more testings, I had finally created a forex trading system that had helped me to achieve profitability in forex trading.
The theory behind the system is that, there is a rotational, repeating cycle in the movement of the market prices. This is much like that of the waves of the ocean, where the waves react in relation to the invisible undercurrents of the ocean. These cycles keep repeating itself again and again with a time frame of not longer than 2 months for each cycle (from experience).
The reason that such a phenomenon happens and repeats itself is due to the nature of human behaviour. All through time, people have basically acted and reacted the same way in the market as a result of: Greed, Fear, Ignorance, and Hope. Markets can change, but human nature has stayed the same for centuries.
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Risk Disclosure:
Forex trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to participate in the futures trading markets. Don't trade with money you can't afford to lose. The past performance of any trading system or methodology is not necessarily indicative of future results.
Feb. 19 (Bloomberg) -- The euro rose from near a three- month low against the dollar on speculation German Chancellor Angela Merkel will signal Europe's largest economy plans to take action to help avert the financial turmoil in the region.
The euro snapped three days of losses against the dollar after Finance Minister Peer Steinbrueck said yesterday Germany would show its "ability to act" as some of the 16 countries that share the currency are getting into difficulties. Merkel will hold a joint press conference with European Commission President Jose Barroso in Berlin today.
"Eurozone countries have started to recognize the importance of the financial system and begun to address it properly," said Akio Yoshino, chief economist at Societe Generale Asset Management Ltd. in Tokyo. "Optimism about the stabilization of the European financial system may help to halt the recent steep decline of the euro."
The euro climbed to $1.2582 as of 11:40 a.m. in Tokyo from $1.2530 late in New York yesterday, when it touched $1.2513, the lowest level since Nov. 21. Europe's single currency advanced to 117.81 yen from 117.50 yen. The dollar traded at 93.64 yen from 93.79 yen yesterday, when it reached 93.96, the highest level since Jan. 7.
Merkel's Cabinet also approved yesterday a draft bill allowing the state to take control of property lender Hypo Real Estate Holding AG, paving the way for the first German bank nationalization since the 1930s. The bill, which will be put to parliament on April 3, allows the government to carry out compulsory purchases of shares in "systemically relevant" banks.
"This is an appropriate response when it comes to resolving the banking system problem," SG's Yoshino said.
Bank Results
Gains in the euro may be tempered by concern European companies will report steeper-than-expected losses stemming from the global financial turmoil.
Axa SA, Europe's second-largest insurer, will probably report today a net loss of 1.76 billion euros ($2.21 billion), according to a Bloomberg News survey of analysts, down from a year-earlier profit of 2.49 billion euros, as slumping stock markets eroded the value of the company's investments.
BNP Paribas SA, France's largest bank by market value, will today likely post a loss of 1.36 billion euros, and Deutsche Postbank AG, Germany's biggest consumer bank by clients, may report a quarterly loss because of credit-related writedowns, according to separate Bloomberg surveys.
'Be Alert'
"We also need to be alert to the ongoing quarterly results of European financial institutions," said Minoru Shioiri, senior foreign-exchange dealer in Tokyo at Mitsubishi UFJ Securities Co., an unit of Japan's biggest banking group "These reports may revive concerns about the depth of the problem in the financial system."
Demand for the dollar was tempered on speculation the nation's largest automakers will fail unless they get increased government aid.
General Motors Corp. and Chrysler LLC, which are seeking as much as $21.6 billion in additional federal assistance, have a 70 percent likelihood of filing for bankruptcy, Moody's Investors Service said yesterday. GM and Chrysler met a deadline yesterday requiring they show progress in revamping operations with $17.4 billion in loans granted so far.
"The uncertainties about the big three automakers may weigh on the upside of the dollar," said Takashi Kudo, director of foreign-exchange sales in Tokyo at NTT SmartTrade Inc., a unit of Nippon Telegraph and Telephone Corp. "If a Chapter 11 filing happens, the initial reaction should be a sell-off of the dollar."
The Bank of Japan may today unveil details of a plan to buy corporate debt and extend lending programs in place to prevent a shortage of credit from deepening the nation's recession, according to a Bloomberg News survey.
Governor Masaaki Shirakawa and his colleagues have said they want to lower companies' borrowing costs rather than trim the key interest rate, which is already close to zero. Policy makers will probably keep the overnight lending rate at 0.1 percent today, economists surveyed by Bloomberg News predict.
All the posting are delayed, I can share live updates of my content via emails. If you are interested to receive live updates, send an email to me at atraderx@gmail.com.
The House version is smaller at $819 billion, and received no GOP support - every Republican representative voted against the bill. However, now Democrats and Republicans from both houses must get together and compromise on a final bill. They must move quickly in order to meet Obama's deadline of President's Day to sign the massive stimulus into law.
The Obama administration has been pushing for the stimulus, no one more forcefully than the President himself. He traveled to Ft. Meyers, Florida Tuesday in order to continue his public tour in support of the stimulus.
"The situation we face could not be more serious," Obama said. "We have inherited an economic crisis as deep and as dire as any since the Great Depression."
"I can tell you with complete confidence that a failure to act in the face of this crisis will bring only deepening disaster. Doing nothing is not an option," Obama added.
He noted that the "time for talking is over.and the time for action is now."
The statistical office revised the rate for November from 7.8%. Economists had expected a rate of 7.9% for the month of December.
Compared with November 2008, the number of persons unemployed increased 230,000 in the Euro area.
Peter Thiel, founder of hedge-fund firm Clarium Capital Management LLC, said the British pound will continue to weaken this year as the U.S. dollar and Japanese yen appreciate.
The U.K. is the “worst country in the world at this point,” partly because of its trade deficits, Thiel said at the World Economic Forum in Davos, Switzerland.
The British government’s efforts to protect the banking system from the financial turmoil last week led to a drop in the pound to the lowest level against the dollar since 1985. The currency traded at $1.4313 as of 11:56 a.m. in New York today.
Thiel, whose fund trades everything from stocks to commodities, seeks to profit from broad economic trends, a strategy known as macro investing. He said that there would be “no fast recovery” of the global economy.
Investors should “stay very underweight equities, if at all, and you basically assume that the bailouts will not work to the degree they are expected to, the government will do less or not succeed in stopping this deleveraging process,” he said. Deleveraging is the process of paying down debt to lessen the risk of default.
Thiel, 41, who co-founded PayPal, started Clarium in 2002 after selling the online-payments service to EBay Inc. for $1.5 billion. His fund lost about 4.5 percent last year, according to investors. Macro funds gained 5.7 percent last year, while all hedge funds lost an average of 18 percent, according to data compiled by Hedge Fund Research Inc. of Chicago.
Government officials including U.S. Treasury Secretary Timothy Geithner have backed greater regulation and disclosure requirements for hedge funds.
“Some degree of regulation is probably desirable at this point, just as a way of reassuring the people who are invested in this industry,” Thiel said
Overall trend of EURUSD is still down.
Confirmation of the downtrend depends on:
1. Whether it will breakout above the short term resistance of 1.3100.
2. Whether it will breakout above the 50 days moving average, which happens to be 1.3100 as well. 50 days moving average has been tested twice and failed (see chart below), so it is a good benchmark.
Traders might want to initiate a short position if EURUSD touches 1.3100 and fall, signals downtrend resumes.
If you do not have a forex trading account and want to try out forex trading, you can open a forex trading account with only minimum capital of US$100, click here to open.
Once you master the art of forex trading, you do not have to worry about job insecurity in 2009, because you will be recession free.
"Nothing happens by itself...it all will come your way, once you understand that you have to make it come your way, by your own exertions." - Ben Stein
The economy contracted 1.5% sequentially in the fourth quarter, following a decline of 0.6% in the prior quarter. Economists had expected the economy to shrink 1.2% in the fourth quarter. From the previous year, GDP fell 1.8% in the fourth quarter, reversing a 0.3% increase in the third quarter.
The output of production industries declined 3.9% sequentially, compared with a decrease of 1.4% in the prior quarter. Manufacturing output dropped 4.6%, while mining and quarrying production slid 1.6%. At the same time, the output of the construction industry fell 1.1% and services output dropped 1%.
The euro is lower Friday as traders cite the likelihood of more weakness for the embattled currency.
Traders said some investors unloaded part of their dollar holdings later as they fretted about comments from the newly minted Treasury Secretary Timothy Geithner that the Obama Administration believes China is manipulating the value of its currency, despite his backing of a strong-dollar policy.
The comments about China fueled a wave of selling in long-dated U.S. Treasury securities amid concern that China may retaliate by unloading its massive amount of government debt holdings. That will raise borrowing costs for the U.S. government, businesses and consumers while further worsening the trade deficit in the U.S.
Risk Disclosure:
Forex trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to participate in the futures trading markets. Don't trade with money you can't afford to lose. This website is neither a solicitation to invest nor an offer to Buy/Sell futures or options. The past performance of any trading system or methodology is not necessarily indicative of future results.
Disclaimer:
The service is offered as an opinion on the current state of the market but not recommendations. The information provided should not be relied on as a substitute for extensive independent research before making your trading/investment decisions. We are merely providing this service for your general information. No representation is being made that any view or opinion will guarantee profits or not result in losses from trading. In addition any projections or views of the market provided may not prove to be accurate.
European Central Bank President Trichet reported yesterday that "2009 will be very difficult, as I indicated last Thursday. The council of governors considers that world and European growth in 2009 will be substantially lower than the forecasts made at the beginning of December." He added "The difficulties are still there, there is not in any circumstance any room for any complacency whatsoever. We must remain permanently ready to act."
The ECB cut rates by 50bps last Thursday and ECB forecasts are expected to be updated in March. ECB member Provopoulos today said the "scope for further rate cuts will be limited." ECB member Nowotny added "The ECB has no interest in interest rates going down to zero." Euro bids are cited around the US$ 1.3055 level.
All the posting are delayed, I can share live updates of my content via emails. If you are interested to receive live updates, send an email to me at atraderx@gmail.com.
The Australian Bureau of Statistics reported Thursday that the jobless rate hit 4.5 percent, compared to November's reading of 4.4 percent.
The report showed the Australian economy lost 44,000 full-time jobs in December, bringing the total number of full-time employees to 7,640,200. The December figure marked the third increase in lost jobs in four months, bringing the cumulative loss for the period to 77,000.
Part-time employment, meanwhile, swelled by 42,800 to 3,102,200, an indication that employers are cutting back on the number of hours worked rather than eliminating jobs outright.
The job loss was far worse than the 20,000 decline predicted by most economists and was the largest decline in full-time positions since March 2003.
Initial news of the better-than-expected jobless rate sent the Australia dollar higher, but the gains were short-lived when investors saw the sharp decline in full time jobs. The Aussie fell to a low of 0.6575 before rebounding.
All the posting are delayed, I can share live updates of my content via emails. If you are interested to receive live updates, send an email to me at atraderx@gmail.com.
