Investing.com - Financial Markets Worldwide
Get 40% Off
Get 40% Off
🚨 Volatile Markets? Find Hidden Gems for Serious Outperformance
Find Stocks Now

Daily Report: Dollar Soft On Fed Speculation

ByActionForex
Published 07/26/2013, 04:58 AM
Updated 03/09/2019, 08:30 AM

Dollar stays soft today and recent decline extends on speculation on Fed' forward guidance in next week's meeting. An article by WSJ argued that FOMC members are going to have a debate on modifying the statement to clearly distinguish between the asset purchase program and interest rates. And, it would possibly refine or even revise the forward guidance language to emphasis that interest rates will stay low for long. Besides, while markets have been speculating that Fed will taper the $85b per month asset purchase program in September, Bernanke has clearly stated last week that it's "way too early to make any judgement". Market participants will also be keen to get more hints about the timing of the tapering. As for now, dollar will likely stay weak against other major currencies before the week closes.

In the Eurozone, the July ECB Bank Lending also surprised to the downside. Same as the situation in June, outflow of new loans was reported in both households and non-financial corporate (4B euro and 12B euro respectively). For 2Q13 as a whole, negative flows have reached 46B euro for businesses and 3B euro for households. The report indicates that banks are still tightening their credit standards, suggesting that banks continued to view the economic and financial outlook in the 17-nation bloc as uncertain.

Yen extended rebound today as inflation data showed that national CPI rose more than expected to 0.4% yoy in June. Tokyo CPI core also accelerated to 0.3% yoy in July, inline with expectation. Technically development in yen crosses argues that more upside in the yen would be seen. USD/JPY has breached 98.89 minor support while GBP/JPY also breached 152.04 minor support. We'd possibly below yen cross accelerates downwards next week.

3rd party Ad. Not an offer or recommendation by Investing.com. See disclosure here or remove ads .

Latest comments

Install Our App
Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.