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US Session – Dollar gains on risk aversion

Posted on November 7, 2012 at 7:02 pm GMT

Election euphoria has faded and uncertainty prevails in the markets as the U.S. “fiscal cliff” returns to haunt Obama. After winning a second term in office, Obama now faces urgent economic challenges in the U.S. and has to reach a deal to avert falling back into recession. The so-called “fiscal cliff” involves $600 billion in tax increases and spending cuts which come into effect on January 1 2013. It will be the end of temporary payroll tax cuts (resulting in [..]

Forex News – Obama faces fiscal cliff

Posted on November 7, 2012 at 5:39 pm GMT

Obama has won a second term in office but now has to face urgent economic challenges in the U.S. , particularly the so-called “fiscal cliff”. Basically the fiscal cliff concerns the end of last year’s temporary payroll tax cuts (resulting in a 2% tax increase for workers), the end of certain tax breaks for businesses, all-in-all a $600bn mix of automatic tax hikes and spending cuts. The terms of the Budget Control Act of 2011 are scheduled to go into [..]

European Session – Euro tumbles as focus returns on Europe’s crisis

Posted on November 7, 2012 at 1:23 pm GMT

The dollar cut losses and euro tumbled in the European session after a turnaround in risk appetite that flowed in the aftermath of the Obama victory in the early Asian session. With the U.S. election out of the way, markets switched focus again on key fundamentals such as the euro zone debt crisis. There was a series of negative headlines out of Europe this morning, with downbeat European Commission forecasts and weak German data. Also there is uncertainty as Greece’s [..]

Forex News – Markets rally after Obama wins second term

Posted on November 7, 2012 at 8:50 am GMT

President Obama’s re-election for a second term in office resulted in boosting risk appetite in the markets, lifting risk currencies and commodities higher while causing the U.S. dollar to fall. An Obama victory leads to a continuation of the status quo, meaning loose monetary policy. The head of the Federal Reserve Ben Bernanke will likely remain in office. He is perceived as dovish and will likely continue stimulus measures of quantitative easing, which causes dollar to weaken. However, dollar strength [..]

Asian Session – Dollar falls after Obama re-election

Posted on November 7, 2012 at 6:41 am GMT

Dollar and U.S. stock futures edged lower after Barack Obama was re-elected for a second term as U.S. President. This is perceived is better for bonds, as a second term would see continuation of the current Federal Reserve Chief Ben Bernanke’s monetary easing. Such stimulus measures usually leads to a drop in U.S. Treasury prices and weakens the U.S. dollar. The dollar tumbled against the yen in Asian trading on Wednesday, falling below the key 80 yen mark to a [..]

US Session – Risk on as U.S. election gets underway

Posted on November 6, 2012 at 8:55 pm GMT

Risk was back on in the U.S. trading session on Tuesday, leading the dollar to fall against most risk currencies. U.S. stocks rallied, extending gains into a second day as American voters are heading to the polls while the elections get underway in the United States. First exit polls are not expected until early Asia trading hours, so moves are expected to be small during the U.S. session. For the currency markets, the key driver in the near term is [..]

European Session – Euro under pressure ahead of Greece austerity vote

Posted on November 6, 2012 at 1:03 pm GMT

Euro remains under pressure against the dollar weighed by grim euro zone data and uncertainty in Greece. Euro zone services PMI index is still in the contraction phase while September German industrial orders fell the most in a year and by more than forecast, as demand from countries in the euro zone faltered. Meanwhile the Greek parliament is expected to vote on new austerity measures this week in order to be able to receive the next bailout tranche from its [..]

Forex News – Reserve Bank of Australia holds rate at 3.25%

Posted on November 6, 2012 at 7:14 am GMT

The Australian dollar jumped 0.6 percent against the US dollar after the Reserve Bank of Australia announced it decided to leave the key interest rate on hold at 3.25 percent. There were expectations that the central bank was going to cut the overnight cash rate by 25 basis points and the surprise of keeping it unchanged spurred the aussie to the highest level since September 28, hitting $1.0436. The recent stronger than expected economic data prompted the RBA to hold [..]

Asian Session – Aussie jumps after RBA keeps interest rates unchanged

Posted on November 6, 2012 at 6:44 am GMT

Aussie surged after the Reserve Bank of Australia unexpectedly kept interest rates unchanged. The central bank was expected to cut the overnight cash-rate by 25 basis points but it left it at 3.25 percent. AUDUSD jumped to the highest level since September hitting $1.0436 from where it was before the news at $1.0364. RBA governor Glenn Stevens said that with inflation expected to be consistent with the target and growth close to trend, but with a more subdued international outlook [..]

US Session – Dollar supported ahead of U.S. elections

Posted on November 5, 2012 at 8:16 pm GMT

Uncertainty ahead of the U.S. presidential elections and the upcoming Greek parliamentary vote on key reforms are weighing on investor appetite for assets perceived to be relatively risky. The dollar gained today due to risk aversion in the markets. The U.S. currency is seen as a safe haven as it is the world’s reserve currency. Euro tumbled amid concerns generated by this week’s Greek parliamentary votes, which could determine whether the country receives the next bailout tranche from its international [..]

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