Forex Market Updates & Commentary

Dallas Fed President Fisher Speaks on Bloomberg
Durable Goods & Core PCE Rise, Personal Consumption & GDP Stay According to Forecast
US GDP & Durable Goods Orders Data Due at 8:30AM
BOE’s King
UK Financial Policy Committee
Euro gains a full 100 pips over the last hour.
BOE’s Posen says Germany and other countries should concentrate on fixing problems with their banks regardless of Greece.
IFO’s Abberger
German IFO business climate (June) 114.5 vs. 113.4 expected.
China may raise rates as early as end of June according to a CASS researcher.
Swiss National Bank says a strong CHF is among threats.
Euro making moves lower
Merkel says EU/Greece deal on austerity is a “good message”.
German economist Bofinger says Euro-area should cut Greek debt by 40%.
6-24 Calender

Dallas Fed President Fisher Speaks on Bloomberg

Posted: 24 Jun 2011 05:46 AM PDT

Says

‘Deep hole of unemployment’
Recovery will slow, pick up in second half
Sees plenty of liquidity in U.S.
FOMC isn’t becoming ‘politacally accomadative’
FOMC has ‘telegraphed’ intentions ‘very clearly’
Fed to reinvest MBS proceedings as long as appropriate
‘No final decision’ made on sequencing of fed exit
Favors ‘greater specifity’ on fed inflation goal
FOMC not ‘in the business’ to be popular

Durable Goods & Core PCE Rise, Personal Consumption & GDP Stay According to Forecast

Posted: 24 Jun 2011 05:33 AM PDT

Durable Goods Orders: Survey: 1.5% Actual: 1.9% Prior: -3.6% Revised: -2.7%

Durables Ex Transportation: Survey: 0.9% Actual: 0.6% Prior: -1.5% Revised: -0.4%

Personal Consumption: Survey: 2.2% Actual: 2.2% Prior: 2.2%

GDP Price Index: Survey: 1.9% Actual: 2.0% Prior: 1.9%

Core PCE QoQ: Survey: 1.4% Actual: 1.6% Prior: 1.4%

USD/JPY trading higher on the news.

US GDP & Durable Goods Orders Data Due at 8:30AM

Posted: 24 Jun 2011 04:42 AM PDT

BOE’s King

Posted: 24 Jun 2011 02:52 AM PDT

Uncertainty about exposure to Greece can lead to crisis of confidence.
The issue is indirect exposure to Greece via other nations.
UK bank exposure to Greece “remarkably small”.
Can’t hope to prevent financial crisis, aim is to make financial system more resilient.
Considered qualitative criteria on bank earning retention, calls for more monitoring of “opaque” funding structures.
Better disclosure by major banks should be permanent, calls for more disclosure of banks sovereign exposure.
Banks continue to recover, headwinds remain, sees signs of overheating, no evidence risk under-priced.

UK Financial Policy Committee

Posted: 24 Jun 2011 02:48 AM PDT

Calls for close monitoring of exchange traded funds to protect consumers.
Banks should use strong earnings to build up capital to shield against future stresses.
Small UK banks, not EU stress test, should also disclose sovereign debt exposure.
Calls for banks to improve disclosure of sovereign, bank sector exposure on permanent basis.
Euro-zone debt crisis poses “most material and immediate threat”.

Euro gains a full 100 pips over the last hour.

Posted: 24 Jun 2011 02:25 AM PDT

It seems that risk appetite is stronger following the better than expected German IFO release as we’ve seen the EUR/USD trade 100 points higher in the last hour of trading. Adding to the “fire” was comments from IFO’s Abberger that Greece is not a big problem to the real economy in Germany, and he sees no risk of the German economy “overheating”.

On the hourly chart below you can see that the EUR/USD has tested resistance at 1.4305; an old support level from early in the month.

BOE’s Posen says Germany and other countries should concentrate on fixing problems with their banks regardless of Greece.

Posted: 24 Jun 2011 01:14 AM PDT

IFO’s Abberger

Posted: 24 Jun 2011 01:08 AM PDT

Seeing enormous economic risks, especially internationally.
Export expectations of German companies in June declines vote.
Expect no strong economic impact from planned tax cuts in Germany.
Expects further interest rate hikes by ECB in July and European Autumn, digestible for German companies.

German IFO business climate (June) 114.5 vs. 113.4 expected.

Posted: 24 Jun 2011 01:01 AM PDT

The euro gained against all of the major currencies on the release.

China may raise rates as early as end of June according to a CASS researcher.

Posted: 24 Jun 2011 12:38 AM PDT

Swiss National Bank says a strong CHF is among threats.

Posted: 24 Jun 2011 12:37 AM PDT

Adds that downside risks predominate; European debt crisis among downside risks and sees “danger of overheating” on Swiss real-estate market.

Euro making moves lower

Posted: 24 Jun 2011 12:35 AM PDT

We saw some consolidation in the EUR/USD between 1.4241 and 1.4271 as we sat waiting for the arrival of Europe into the market. After making a move lower through the 61.8%, the pair tested the 100 bar moving average and is currently approaching the 38.2% line. If momentum brings us through 1.41974, we will be looking to 1.41701 as the next downward target.