Forex Previews

Japan’s economy shrinks in Q2 on lower exports and consumption

Posted on August 17, 2015 at 11:46 am GMT

Economic growth in Japan tipped back into negative territory in the second quarter of 2015, contracting by 0.4% quarter-on-quarter. The figure was slightly above estimates of -0.5% but is sharply down from the first quarter’s upwardly revised 1.1% growth. It also reverses two quarters of growth, when GDP bounced back after a hike in sales tax pushed the economy in recession in Q2 and Q3 of 2014. Second quarter growth was hurt by lower exports to the US, Europe and [..]

Week Ahead – Busy week for markets in the middle of holiday season

Posted on August 14, 2015 at 10:15 am GMT

Next week will feature a significant number of key events and data releases that are likely to have an impact on foreign exchange markets. From Japanese GDP to UK and US inflation, minutes of monetary policy meetings from Australia and the US and business sentiment surveys, are all likely to be closely watched for clues – particularly with respect to future monetary policy moves. Starting the week will be Japanese GDP – expected to show a contraction of 0.5% during [..]

PBOC verbal intervention soothes markets, says no further devaluation

Posted on August 13, 2015 at 10:10 am GMT

The Chinese yuan moved lower for a third consecutive day on Thursday but was more stable compared to the more aggressive and quick moves in the past two days. The People’s Bank of China (PBOC) set the reference rate between the US dollar and the yuan at 6.4010. The prior fix on Wednesday was at 6.3306. The yuan saw the biggest fall on Tuesday of almost 2% when the central bank raised the midpoint from 6.1162 to 6.2298, roiling markets [..]

Pound dragged lower by soft UK jobs and earnings data

Posted on August 12, 2015 at 10:04 am GMT

UK unemployment showed signs of cooling off in June as the ILO measure of unemployment rose by 25,000 to 1.85 million in the three months to June. The unemployment rate stayed unchanged at 5.6%. Total employment fell by 63,000 over the quarter to 31.03 million, but was still higher than a year ago by 354,000 and the employment rate fell slightly to 73.4%. An unexpected drop in the number of people claiming unemployment benefits, which is one month ahead of [..]

China devalues yuan on faltering economic growth

Posted on August 11, 2015 at 11:59 am GMT

China devalued its currency, the yuan, on Tuesday after recent economic data pointed to a deepening slowdown in the world’s second largest economy. The People’s Bank of China devalued the yuan by 1.9%, lowering the midpoint from 6.2298 per dollar to 6.1162 per dollar. China’s currency is not allowed to fluctuate more than 2% a day from the midpoint but investors were pleased that the midpoint will now be set based on market makers’ quotes and the previous day’s closing [..]

Week Ahead – Eurozone Q2 GDP and UK jobs in focus

Posted on August 7, 2015 at 12:58 pm GMT

The euro is likely to come back into the spotlight next week after a lull in recent weeks. The Eurozone will see its first estimate of second quarter growth and UK unemployment data will also be closely watched, in addition to US retail sales and various industrial production data. The week will get off to a quiet start with only inflation data from China likely to interest the markets. CPI data out on Sunday is expected to show Chinese inflation [..]

Pound tumbles on MPC vote as BoE cuts inflation forecast

Posted on August 6, 2015 at 1:50 pm GMT

The Bank of England’s latest Monetary Policy Committee (MPC) meeting minutes showed that the committee voted 8-1 to keep interest rates unchanged, against expectations of a 7-2 split. The surprise dovishness was reinforced by the Bank’s quarterly inflation report published simultaneously with the minutes, which showed the inflation forecast being cut to 0.3% for 2015 from 0.7% in May’s forecast. The lower inflation outlook comes despite UK economic growth being upgraded to 2.8% for 2015 from 2.5% in May’s forecast. [..]

Kiwi under pressure on weak employment growth and lower dairy prices

Posted on August 5, 2015 at 11:20 am GMT

The New Zealand dollar touched a new 6-year low earlier on Wednesday, dropping to 0.6517 against the US dollar. A modest recovery in oil prices and an aussie rally provided only limited support to the kiwi as weak employment data and another drop in the global dairy price index weighed on the currency. Employment in the second quarter rose by just 0.3% in New Zealand, against expectations of a 0.5% rise. This was down on the first quarter’s 0.7% growth. [..]

Aussie surges after RBA removes reference for further depreciation

Posted on August 4, 2015 at 10:58 am GMT

The Reserve Bank of Australia announced its latest policy meeting decision on Tuesday and kept its cash rate unchanged at the record low of 2.00%. Markets were not expecting another cut this month as the RBA assesses the impact of its previous two 0.25% cuts in February and May. It may also prefer to wait and see how the sharp depreciation of the Australian dollar feeds into import prices and boosts exports before taking further action. The Australian dollar has [..]

Eurozone and UK manufacturing PMI beat forecasts but Greek output plunges

Posted on August 3, 2015 at 12:07 pm GMT

The final manufacturing PMI for the Eurozone was revised slightly higher to 52.4 from the initial reading of 52.2 in July, versus estimates that it would be unchanged. The UK’s manufacturing PMI for July was also positive as it came in at 51.9, which was above estimates of 51.6. In the Eurozone, strong growth was recorded in Netherlands, Italy and Spain, which outperformed the rest of the euro area. Germany saw slightly slower pace of expansion compared to June but [..]

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