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US DollarThe US dollar declined today, along with other safe currencies, as manufacturing growth in Europe and China was somewhat higher than was predicted by forecasters, reducing demand for the currency as a safe haven.
HSBC Flash China Manufacturing PMI was at 49.8 in August, somewhat higher than the median forecast of 49.7 and the highest level in two months. Flash Eurozone Manufacturing PMI was at 49.7 this month, a little higher than expected (49.6), but lower than July figure — 50.4. The Standard & Poor’s 500 Index rose 1.5 percent, while the Stoxx Europe 600 Index went up 1.6 percent.
EUR/USD rose from 1.4357 to 1.4483 today as of 10:33 GMT and posted the high of 1.4499 during the day. GBP/USD climbed from 1.6450 to 1.6544, while reached the intraday high of 1.6572 earlier.
If you have any questions, comments or opinions regarding the US Dollar, feel free to post them using the commentary form below.
Earlier News About the US Dollar:
* Dollar Rises While Traders Afraid of Recession (2011-08-18)
* Good Week for Dollar Even After FOMC Statement (2011-08-13)
* Week Begins with Fall of EUR/USD & USD/JPY (2011-08-08)
* Future of the US Dollar with AA+ Rating (2011-08-07)
* Dollar Declines as Stock Markets Continue Their Fall (2011-08-05)
Great Britain poundThe Great Britain pound tumbled today as the Services Purchasing Managers’ Index slumped in August, confirming a bad state of Britain’s economy and reducing attractiveness of the UK currency as a haven from problems in continental Europe.
The Services PMI dropped from 55.4 in July to 51.1 in August, only a little above the level of 50.0 that indicates no change. The report said:
Respondents primarily blaming a weaker underlying trend in new business and general economic uncertainty. There were a few reports that the rioting and public disorder seen in some areas of the country in early August had adversely affected activity.
GBP/USD slumped from 1.6150 to 1.6076, following the jump to 1.6185, and GBP/JPY tumbled from 124.20 to 123.64 today as of 14:01 GMT.
If you have any questions, comments or opinions regarding the Great Britain Pound, feel free to post them using the commentary form below.
Earlier News About the Great Britain Pound:
* Pound Profits from Terrible US Payrolls (2011-09-02)
* Forecast: Fundamentals Aren't Favorable for Pound (2011-08-30)
* Pound Goes Down as UK Economy Slows (2011-08-26)
* GBP Falls vs. EUR with Consumer Confidence & Retail Sales (2011-08-25)
* Pound Rises as Inflation Accelerates (2011-08-16)
EuroThe euro plunged today, falling for the fifth consecutive session against the US dollar and the Japanese yen, after Germany’s ruling party lost election.
German Chancellor Angela Merkel’s Christian Democratic Union lost election in all six German states. The results of the elections ignited worries that now Germany will be even more opposed to paying bailouts with money of its taxpayers. The Stoxx Europe 600 Index of shares lost 2.8 percent, falling for the second day.
EUR/USD slipped from 1.4161 to 1.4121 and EUR/JPY fell from 108.92 to 108.56 as of 12:50 GMT today.
If you have any questions, comments or opinions regarding the Euro, feel free to post them using the commentary form below.
Earlier News About the Euro:
* Euro Ends Rally as ECB Expected to End Interest Rates Hikes (2011-08-30)
* Euro Falls for Second Day vs. Dollar (2011-08-25)
* Euro Drops as Europe's Economic Growth Slows (2011-08-16)
* Euro Weakens as Investors Shun European Bonds (2011-08-02)
* Euro Slids for Second Day on Debt Crisis Concern (2011-07-28)
Australian dollarThe Australian dollar rallied for almost the whole week, posting the third week of gains against the US dollar in the longest run of weekly gains since April, but by the end of the week fundamentals became unfavorable for the currency.
The Australian dollar was rising on the speculation the Reserve Bank of Australia won’t cut the interest rates. Futures on interest rates indicate only 20 percent probability that RBA Governor Glenn Stevens will cut the bank’s main rate on September 6. Most traders believe that there is 80 percent chance the central bank will maintain the key rate unchanged this month. Australia’s Cash Rate is considered the biggest target lending rate among developed nations.
The rally of the Aussie looked unstoppable until the US non-farm payrolls came out, sending markets in disarray and destroying risk appetite as they came out even worse than most pessimistic forecasts. The Australian currency managed to stay above this week’s opening, but erased three days of gains against the dollar and the yen. What’s worse, it looks like the growth-linked currency may continue to fall next week as risk-aversion style of thinking is returning to markets.
AUD/USD opened at 1.0583, jumped to 1.0764 and closed at 1.0641 this week. EUR/AUD slid from 1.3692 to 1.3346. AUD/JPY jumped from 81.23 to 82.81 during this week before closing at 81.71.
If you have any questions, comments or opinions regarding the Australian Dollar, feel free to post them using the commentary form below.
Earlier News About the Australian Dollar:
* Australian Retails Sales Go Up, Aussie Follows (2011-09-01)
* Building Permits in Australia & New Zealand Rise, Aussie & Kiwi Gain (2011-08-30)
* Aussie Recovers on Stevens' Speech (2011-08-26)
* Australia's Dollar Weakens on Germany's Consumer Confidence (2011-08-25)
* Australia Dollar Receives Help from Commodities (2011-08-17)
US DollarThe US dollar fell against other major currencies, including the Great Britain pound and the Japanese yen, today after the non-farm payrolls showed that job creation in the US stalled. The currency also slipped against the euro, but later rebounded.
US non-farm payrolls showed no employment growth in August. That’s much worse than the market expectations (growth by 74,000) and the worst reading since September 2010, when employment declined by 95,000. Average hourly earnings dropped 0.1 percent, while markets counted on an increase by 0.2 percent. The poor economic report renewed speculations that the Federal Reserve needs third round of asset purchases, known as quantitative easing, to bolster the economic recovery in the United States.
The Dollar Index managed to rise 0.3 percent to 74.683 today from 74.479 yesterday. The dollar trimmed losses versus the pound and the yen, as well as rebounded versus the euro. The Standard & Poor’s 500 Index plunged as much as 2.3 percent.
GBP/USD climbed from 1.6177 to 1.6253 before trading at 1.6220 as of 19:40 GMT today. USD/JPY fell from 76.91 to 76.80 and touched low of 76.52 intraday. Meanwhile, EUR/USD tumbled from 1.4257 to 1.4199.
If you have any questions, comments or opinions regarding the US Dollar, feel free to post them using the commentary form below.
Earlier News About the US Dollar:
* US Manufacturing Expands, Dollar Profits (2011-09-01)
* USD Gains vs. EUR & CHF, Falls vs. JPY (2011-08-30)
* Fundamentals are Bad for US Dollar, But Week Wasn't Bad (2011-08-27)
* Dollar Drops After Bernanke Speech & GDP Report (2011-08-26)
* Will Bernanke Announce QE3? Will Dollar Decline? (2011-08-25)
Swiss francThe Swiss franc climbed today against the US dollar, extending its rally for the third day, after the non-farm payrolls showed that US employers weren’t adding jobs last month.
US non-farm payroll employment showed no change in August, while the unemployment rate remained at 9.1 percent. Analysts predicted an increase of payrolls by 74,000. July value was revised down from 117,000 to 85,000. It’ll be interesting to see how the Federal Reserve will react to such disastrous economic data and what steps it’ll take.
USD/CHF plunged from 037954 to 0.7811 as of 13:45 GMT today. Earlier, the currency pair reached 0.7711, the lowest level since August 12.
If you have any questions, comments or opinions regarding the Swiss Franc, feel free to post them using the commentary form below.
Earlier News About the Swiss Franc:
* Franc Rallies as SNB Doesn't Intervene (2011-09-01)
* Franc Falls as Bernanke Improves Sentiment on Markets (2011-08-26)
* Franc Gains as Markets Return to Risk Aversion (2011-08-24)
* Franc Falls for Second Day on Risk Sentiment (2011-08-24)
* Franc's Rally Fails on Euro-Peg Speculation (2011-08-23)
South Korean wonThe South Korean won gained today as the comments of Federal Reserve Chairman Ben S. Bernanke last Friday increased risk appetite among Forex market participants, bolstering appeal of higher-yielding currencies.
Bernanke made comments on August 26 about ability of the US to support growth of its economy in the long run. Markets reacted positively and traders began search for higher-yield. South Korean trade balance surplus widened to $4.94 billion in July from $2.03 billion in June.
USD/KRW fell from 1,080.10 to 1,073.50 today as of 13:46 GMT.
If you have any questions, comments or opinions regarding the South Korean Won, feel free to post them using the commentary form below.
Earlier News About the South Korean Won:
* Korean Won Falls on Anticipation of Crisis (2011-08-19)
* Korea's Won Retreats After Rally (2011-08-12)
* South Korea Holds Interest Rates, Won Goes Lower (2011-08-11)
* South Korean Won Suffers from Europe's Troubles (2011-07-12)
* Higher South Korea's Inflation Leads to Gains for Won (2011-07-01)
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